Can Silicon Beach Boost LA's Property Values?

Real estate experts have noticed that tech booms link up nicely with property value booms, particularly in neighborhoods that give easy access to the offices where these start-up companies are flourishing.  San Francisco made news this year for this phenomenon. Now it’s LA’s turn.

The LA Times recently reported on a hundreds of tech start-ups surfacing in LA, earning it the moniker “Silicon Beach.”

“MuckerLab, Amplify, Launchpad LA and K5 are just some of the local accelerators to emerge….. being run by former tech executives and investors who are using their connections and clout to prop up budding companies, typically for a 6% to 10% stake in the start-ups.”

Though LA will have to compete with the San Francisco Bay area for seed money, start ups are fast becoming a good investment again in the eyes of venture capitalists, in the wake of companies like Facebook, Yelp, Twitter and Zynga. The latter companies, all San Francisco or Silicon Valley based, are credited with driving up both rents and home prices in the Bay Area.

Will LA follow suit? Certainly, if even one of the 1oo or more start ups in the area becomes as big as Facebook, we should expect reverberations in nearby real estate values. And in the meantime, a hub of job-creating, media attention grabbing activity boosts LA’s general economic health—again, a strong factor in real estate recovery.  Want a closer look? Check out Silicon Beach TV.

Anna Marie Erwert writes from both the renter and new buyer perspective, having (finally) achieved both statuses. She focuses on national real estate trends, specializing in the San Francisco Bay Area and Pacific Northwest. Follow Anna on Twitter: @AnnaMarieErwert.

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