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High tech hopes: Can Bloomington's tech park succeed?

April 10, 2015

Google probably won't open its next satellite campus in Bloomington. But city officials say the idea of a tech giant moving into town isn't as outlandish as it might seem.

Santa Clara County, California, home to tech capital Silicon Valley, holds the No. 1 spot on Milken Institute's index of best-performing cities for high-tech employment. The economic think tank ranked the location of corporate headquarters for Google, Apple and eBay as the top location in the country for high-technology industries relative to population among large cities in the United States.

Bloomington holds the Milken Institute's No. 2 spot for small cities.

"The Bloomington tech sector is one that's growing. We're starting to get a lot of visibility in terms of the pace at which our sector is growing," said Danise Alano-Martin, director of the city's economic and sustainable development department. "Basically, what we're looking for is housing where people who work in the downtown can actually live also."

After years of a growing Indiana University student population dominating downtown housing, Bloomington city planners believe diversification is possible through the employees who "live, work and play" in the Certified Technology Park. The city purchased a $9 million, 12-acre property within the 65 acres of state-designated tech park from Indiana University in 2011.

As the property owner, the city has final decision-making power over the development projects built within the 12 acres. In a December request for proposals, the city specifically expressed interest in high-technology, research and development office use and residential units to house workforce professionals.

"We have the ability to look for a longer payoff in terms of a greater diversity downtown in terms of supporting additional office space and additional jobs," Alano-Martin told The Herald-Times.

For the tech park to succeed, Bloomington has to find the proper balance of people and projects. Without places to live, the young professionals who work in Bloomington could choose to live as far away as Indianapolis, where rents are far cheaper — even factoring in a commute. And without a workforce, businesses looking to start or expand into office space won't consider the tech park as prime real estate.

"The key for the downtown diversity of the apartment market is job growth. We need job growth. Right now, I'm not seeing that dynamic job growth. That's what will drive the diversity of the downtown product," said Eric Stolberg, president of WS Property Group, a commercial development group that has built several residential and commercial development projects in Bloomington over several decades.

"Everyone's talking about technology and the generation that will be employed by the tech sector. That would be a wonderful demographic. That would be younger, recent graduates, that would be a great mix for us to have in the downtown. But again — where's that going to come from?"

Stereotypical Midwestern modesty may be partially to blame for Bloomington's lack of public recognition as a leader in the industry, according to Katie Birge, director of the Bloomington Tech Partnership. The partnership offers networking opportunities, recruitment and technical assistance with funding from the city of Bloomington, the Indiana University Office for Engagement and the Bloomington Economic Development Corp.

"The tech scene is growing, it's growing rapidly," Birge said. "I think it's quietly been a tech hub for a while."

Local tech companies have grown without financial assistance, and Indiana University serves as both a major employer and major provider of employees. IU's tech support, University Information Technology Services, is a top employer, and Birge says many IU graduates are finding their way back to Bloomington — if they ever left — to work in the tech sector.

Last year, the job board on the tech partnership's website listed more than 200 employment opportunities. Since the first of the year, more than 80 new tech jobs have been posted.

Cigital, a Virginia-based software security firm, opened a branch in downtown Bloomington in 2012. On Tuesday, the branch announced plans to double in size and hire about 30 specified software consultants and architects in the coming months. And this week, the annual "Combine" conference, sponsored by the city and BTP, will bring scores of budding entrepreneurs and tech startup enthusiasts to town.

Birge said it's still too early provide a specific number of tech workers and tech businesses in Bloomington, but said those numbers are definitely growing.

"If the pace stays consistent this year, we'll we be on track to post more than 600 open jobs in the tech sector," Birge said. "You need to have everything going for you as a community to try to help fill 650 open jobs."

And Bloomington has a lot going for it: Cost-of-living expenses are far less than a major metropolitan city like Los Angeles or New York City. The city's "small-town" feel also transfers well to networking, according to Birge, which is a crucial component of tech work. And more and more job openings mean that workers can change jobs or career paths without moving away.

But high rent prices downtown, especially for new college grads in entry-level jobs with lower salaries, could mean another city wins the bid for their talent.

"Nothing is keeping young tech workers in Bloomington. It's a great place to live, but lots of places are great places to live," Birge said. "And housing is one of those things that gets overlooked for this demographic, I think. That is one of the big deciding factors in whether or not a person stays for a long period of time."

Office space is also a limited resource in town, and as companies increase employment, they also grow physically. Expanding into additional adjacent office space is sometimes an option, but Birge says there isn't a location for a major company to set up headquarters in Bloomington.

"It's kind of two problems. Companies need office space to expand, and they need to diversify housing for the people that would work there, and they're both kind of immediate needs. If we need to fill 650 jobs this year . we can't put them all in luxury student housing."

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