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Toronto Tech Boom

blixtex

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I just read the article Alvin posted. I think it is interesting because it gives some idea of the general size of the tech market within our general office market in Toronto. You can see that Tech still represent a very small niche in terms of the overall office supply but it also is having an outsized influence on present absorption rates.

This phenomenon of Tech office growth is not unique to Toronto. It basically represents the trend in pretty well every city in North America. I'm curious how different the scenario is here or if it is just a reflection of the general trend. What I mean is that there are two kinds of growth trends in business, there is expansion of the pie, and increasing market share within the pie. In Finance for instance we have seen the general industry expand over the last 10 years but remarkably we have also seen Toronto's share of the pie in Canada increase over that period. That is a pretty powerful combination and enough it seems to offset the countervailing trend of greater efficiency in office space use. We may be seeing both also occurring here in terms of tech.

The Tech boom we are seeing now is a great thing but as an investor I also see this office and growth boom as something to watch for in 2018 as a sign of potential hubris, a potential sign of overinvestment in the sector.
Most of these tech jobs are going to 'foreigners' or new immigrants. But yes, there is definitely a push for downtown office space since they realize it's much easier to attract and retain talent downtown. My wife's company is a tech company and was based in Markham. But moved as it was growing and needed a location where it could attract that talent. She said recently, 'tech fest' beat all expectations in terms of attendance and people in the field. My good friend who was at a Fortune 500 type company moved to a start-up and said he would never go back to a bigger company and said it opened his eyes to what other opportunities were out there.

Toronto does have the lowest office vacancy rate in N. America. And yes, there are huge explosions in tech in places like Atlanta, Dallas, Orlando, Charlotte and many other cities (which also explains why alot of these old conservative States are turning more liberal and Democratic friendly). The big draw for those newer up and coming tech cities are a certain higher standard of living in terms of housing, warmer weather, buying a car and driving into work. Lower rental rates, taxes, heating costs also make it easier for companies to turn a profit, pay higher, etc.

However, what I think will continue to fuel Toronto's boom is that it has Manhatten like infrastructure (transit in the core, shops, restaurants, city living) that younger people actually like. Alot of those newer up and coming cities as well are more of a downtown in a suburb. Meaning that the transit is more like suburban buses, some rail, mostly driving (I've researched this as part of my job). My wife also works with many and manages a couple of millennials, and my own reading and study on the generation, and they will say, they absolutely LOVE Toronto and all its city like amenities/density. US cities however are more set up to attract people who want to have families, less of that city social life, less density.

This was covered more recently, but does a good job explaining why there's growing interest in Toronto for Tech folks. He specifically compares it to Silicone Valley where it's extremely expensive. And also stuff like Canadian things where you're not beholden to your employer for your VISA, more safety/less paranoia, convenience of not needing a car, better schooling for public school, etc.

https://torontolife.com/city/life/moved-silicon-valley-toronto-now-im-getting-others/
https://movnorth.com/
 

jje1000

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The big draw for those newer up and coming tech cities are a certain higher standard of living in terms of housing, warmer weather, buying a car and driving into work. Lower rental rates, taxes, heating costs also make it easier for companies to turn a profit, pay higher, etc.

However, what I think will continue to fuel Toronto's boom is that it has Manhatten like infrastructure (transit in the core, shops, restaurants, city living) that younger people actually like. Alot of those newer up and coming cities as well are more of a downtown in a suburb. Meaning that the transit is more like suburban buses, some rail, mostly driving (I've researched this as part of my job). My wife also works with many and manages a couple of millennials, and my own reading and study on the generation, and they will say, they absolutely LOVE Toronto and all its city like amenities/density. US cities however are more set up to attract people who want to have families, less of that city social life, less density.
Very much something that works in our favor- especially if we manage to create a good transit connection to Waterloo. Waterloo can provide that lower-cost living, but Toronto can provide that urbanity.

A lot of the new tech hubs in the US are still a tiny overplanned downtown core surrounded by miles and miles of suburbs. It's hard to create good urbanity out of nothing- and it's very much something that almost needs to be inherited rather than created (the environment needs to mold people to embrace the spontaneity of good urbanity).

That being said, the housing prices here need to be managed, or else it will have a dampening effect on the city's economy (see Montreal and how their tech industry benefits from both cheap housing, family-friendly urbanism and a vibrant urbanity).
 
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WislaHD

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Very much something that works in our favor- especially if we manage to create a good transit connection to Waterloo. Waterloo can provide that lower-cost living, but Toronto can provide that urbanity.

A lot of the new tech hubs in the US are still a tiny downtown core surrounded by miles and miles of suburbs. It's hard to create good urbanity out of nothing- and it's very much something that almost needs to be inherited rather than created (the environment needs to mold people to embrace the spontaneity of good urbanity).

That being said, the housing prices here need to be managed, or else it will have a dampening effect on the city's economy (see Montreal and how their tech industry benefits from both cheap housing, family-friendly urbanism and a vibrant urbanity).
I think it is not just Waterloo that should be considered in this context.

Hamilton as soon as it is fully equipped with GO-RER to Toronto, is perfectly positioned for such a boom. They have inherited a brilliantly urban streetgrid, are developing their own LRT system, and are on the cupst of their own construction and high-rise boom. They even have an (underused) international airport that could support much more air traffic.
 

blixtex

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Very much something that works in our favor- especially if we manage to create a good transit connection to Waterloo. Waterloo can provide that lower-cost living, but Toronto can provide that urbanity.

A lot of the new tech hubs in the US are still a tiny overplanned downtown core surrounded by miles and miles of suburbs. It's hard to create good urbanity out of nothing- and it's very much something that almost needs to be inherited rather than created (the environment needs to mold people to embrace the spontaneity of good urbanity).

That being said, the housing prices here need to be managed, or else it will have a dampening effect on the city's economy (see Montreal and how their tech industry benefits from both cheap housing, family-friendly urbanism and a vibrant urbanity).
If there was really a seamless type connection, it would definitely be a good thing. And you're right, hard to create without it somehow 'already' being there. Mostly, it's some kind of rail transit that seems to really spark that urban connection.

Housing is definitely an issue and why condos will continue to do well for along time. That's why generally, the more established companies such as Amazon won't choose Toronto (especially for headquarters type place) knowing the limitations it brings to those that are in a more mature stage (stage of workers similarly reflect stage of company or office). But those still looking to innovate and develop, where there's more younger people not thinking about the family just yet, Toronto still has alot of the inherent advantages. Google saw the abundant supply of raw talent in Toronto for 'brainstorming' grunt type work and is expanding. That's probably also why the start-up culture is also strong here. But if you want to house the more mature managers/families of a headquarter type place that want more space and warmer weather and of course, cheap housing, Toronto is a tougher sell.

I'm not too familiar about Montreal. Probably what's holding it back is the french culture type politics (which I heard has been getting more divisive) that likely suppress some of that more global footprint. But given what I know of it, it definitely is ripe ground for that type of culture an hub.
 

jje1000

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Startups are the rainbows, but the city who creates the Google of AI with get the pot of gold.


Why New York And Toronto Are Forming An East Coast Tech Alliance
Well, in New York, there’s an established and historied market for global business. There are more opportunities for people to enter the technology community and find rewarding jobs, in general. There’s a deep bench of creative, technical and business talent funneling through from around the United States and the world. And there’s an inherent connection many New York City residents — especially natives — have to the city itself.

Meanwhile in Toronto, there’s a smaller, but equally sturdy technology community. The local STEM talent is world class. Many of the world’s AI pioneers are based here. Toronto actively recruits young talent from the U.S. and all over the world to further develop their expertise in Canada. Young talent that makes the move to Toronto tends to stay, too. As Kerry Liu, CEO of Rubikloud points out, recent provincial and federal government investments to increase the number of STEM graduates in Ontario will pay long-term dividends for the tech community in Toronto.

The city’s open business environment and modern commercial infrastructure attract an increasing amount of talent and investment from all over the world. The recent deal signed by Sidewalk Labs to reinvent a section of the City of Toronto is the clearest vote of confidence yet that Toronto is poised to lead urban innovation worldwide. This new hub will be a model for cities globally, not just for its tech infrastructure, but for its development process — building innovation in collaboration with residents, community leaders and government. For Toronto, the partnership is a prominent opportunity to prove to the global community what folks here already know: local innovators can excel and solve problems with lasting global impact.
https://www.forbes.com/sites/forbestechcouncil/2017/12/15/why-new-york-and-toronto-are-forming-an-east-coast-tech-alliance/#2a81d2cd2f74
 

Admiral Beez

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I’m a dinosaur I must admit, since to me a technology boom would be in the design and production of something tangible, a better widget, not programming (or in today’s jargon, coding) software, apps and websites. But my perspective is a little skewed, since I’ve always worked for Canadian firms that make things, from food ingredients to animal feed to confectionery, and even a stint doing export sales for Ontario’s largest nail factory (now, there’s tech you can touch).

My GTA employers have generally been members of associations like http://on.cme-mec.ca/ and http://www.manufacturingourfuture.ca/

So, whenever I hear someone say they work in tech, I want to ask them what they produce, not what they’re programming. I know, I’m out of touch, lol.
 
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SunriseChampion

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I'm out of touch as well. Early 30s and I gave up thinking all this software and Internet stuff was cool around the last time I built my own computer.....1999.
Now I try to stick to as basic and "boring" technology as possible.
I'm happier somewhere in the bush than with a pinging piece of overpriced-ness in my pocket. I'll take bears over emails; sunsets over likes; and hiding over having FB et al knowing what I had for lunch.
Really, I shouldn't even be on the Internet.

I like making works of art with my hands, your apps don't impress me.
 

WislaHD

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As part of the younger demographic (early-mid 20s) on this forum, I sometimes feel out of touch as well.

Don't get me wrong, I am very computer literate (comes with growing up in an era of computers before flawless user design meaning you had to actually go through and edit computer files to make your games work :p), but I just never understood the whole social media thing. Why would you sell your information and privacy for free away to corporations? Facebook was and still is essential for school and connecting to peers, but I would have deleted by now otherwise. Twitter and Instagram have even less of an appeal.

My generation as a whole does not seem to value privacy as highly as I do (and on that point, I always felt as the odd one, perhaps it had something to do with having parents who came from authoritian countries), and increasingly I am believing we've reached a point of no-return on the concept of personal privacy.

So I don't think anyone who feels like a tech dinosaur should feel bad for being 'old', as anyone can feel that way. But hey, at least these industries are employing a lot of people here.
 

SunriseChampion

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I have to disagree with one thing.....FB is not essential for anything. My friends, family, and peers all have phone numbers. As do I.

As I say to my friends all the time: what do I need to see pics of you for? I already know what you look like. As for me, I look like my avatar on here: I became the music of Prodigy. ;)
 

Johnny Au

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I'm in my late 20s and I don't use antisocial media.

Trust me. Your life will be better without being exposed to fake news, political rants, and other highly emotional content.

If I want to connect with my long lost friends, there's always phone numbers and e-mails.

There's a reason why am I still a Wikipedian for over a decade.

Yes, an online community is as good as its moderation.
 

SunriseChampion

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We're proof that not all millenials are "social" media whores. My faith in humanity has just +1-ed!
 

pman

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I don’t understand why people put so much personal information on Facebook. It strikes me as insane to let the world know you’re going to be out of your house for two weeks. For that matter, if you publish the names of your kids and pets, as well as your birth and high school graduation dates, the world has a pretty good start on cracking your security questions for things like online banking.
 

WislaHD

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I have to disagree with one thing.....FB is not essential for anything. My friends, family, and peers all have phone numbers. As do I.

As I say to my friends all the time: what do I need to see pics of you for? I already know what you look like. As for me, I look like my avatar on here: I became the music of Prodigy. ;)
You see, Facebook is not merely a place for posting pictures. It is where groups and organizations post important updates, events and other relevant content. It is the platform where my peer group in university organizes study sessions, share notes, ask questions, organize pub nights. Its use goes beyond posting pictures and reconnecting with old friends. Sure, you can say that you can use other platforms for all that, such as email, but the overwhelming benefit is that nearly everybody is on Facebook and regularly checks it.

It is also the de facto internet messenger in North America seeing as for some reason, WhatsApp is not popular here. (Though, you only need to make the most barebones account to take use of Facebook Messenger).
 

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