South Lake Union’s inclusion in “The Rise of Innovation Districts,” a 2013 report by the Brookings Institute, is flattering to John Schoettler, Amazon’s global director of real estate. Once home to dilapidated industrial warehouses, Seattle’s South Lake Union neighborhood owes its rejuvenation to area resident Amazon and its well-compensated workforce. “Innovation is central to our core values,” Schoettler says. “The vision isn’t to create a campus so much as become integrated with the neighborhood.” But along with colorful new restaurants and retail stores, Amazon has also attracted sky-high rents, growing income disparity, traffic congestion and other problems.
In short, the influence of innovative technology companies on urban environments is transformative — sometimes for both better and worse.
Twitter relocated its headquarters to San Francisco’s Mid-Market district in 2011. In exchange for promising to revitalize the neighborhood, the City granted Twitter payroll tax exemptions. But by the account of San Francisco planning director, John Rahaim, Twitter and its employees have failed to live up to expectations: “I am concerned with the tech companies that are taking a suburban mindset while relocating to the city. They are basically putting up walls around their offices in the Market district.” Eateries are shunned in favor of on-site food service, and buses are scorned because private shuttles are more convenient.
Twitter and other insulated tech companies have electrified an already bitter debate about urban development in San Francisco. For one, longtime residents’ fears of density and height have limited apartment construction, contributing to a housing shortage as new tech workers move to town. “We have been underbuilding housing in this city for 20 years,” says Rahaim. “What we find now is the pace of change is what causes the most pushback [against increased density].” US Census data shows that the median rent price in San Francisco has reached almost $1,500, forcing artists and blue-collar workers to flee to Oakland and sprawling cities beyond.
The tech industry is also influencing Kansas City, but in ways that are potentially more positive overall than in San Francisco. Coworking tech spaces like Sprint Accelerator and ThinkBIG are repurposing historic brick buildings in the near-downtown Crossroads District and advocating for a walkable, vibrant urban core. However, the burgeoning community’s efforts conflict with a City planning agenda facilitating suburban development in farmlands and demolition of downtown structures to provide parking lots. Current construction of a streetcar linking tech hubs to surrounding areas is the first step in fostering the neighborhood’s rebirth. “Tracks in the ground have the ability to drive development decisions [and] the resulting new development often brings new uses and amenities to vacant and underused parcels,” says Josh Boehm, an urban planner at Kansas City architecture and design firm BNIM.
According to Jase Wilson, CEO of the Kansas City startup Neighbor.ly, divestment in the city’s downtown is a product of moneylenders’ profit motives, but he is working to change that. By bringing crowdfunding to the municipal bond market, his company allows people to invest in civic projects they care about — like Kickstarter for new schools and hospitals. Neighbor.ly will undoubtedly influence cities around the US, Kansas City included. With a steady influx of new tech workers seeking an urban lifestyle, the revival of a diverse, livable downtown is on the horizon for Kansas City.
Across the world in Kenya, government and international investors look to build the $14.5 billion, master-planned Konza Techno City in the savannah 37 miles south of Nairobi. The country’s Ministry of Information and Communications Technology reports the project will support 100,000 people at universities, hospitals, technology headquarters and business offices by 2030. But locals aren’t convinced the funding will stimulate Nairobi’s existing technology industry. “I think there is so much energy already that it’s possible we will already have a tech city before 2030,” says Jessica Colaço, director of partnerships at the coworking space iHub in Nairobi.
Spaces like iHub have proliferated to service the rapidly expanding market of consumers recently connected to the Internet, and real estate developers are renovating buildings around these tech zones, providing housing and office space. Most of Nairobi is filled with low-rise masonry buildings built by individuals. The government could underwrite the creation of taller buildings, promoting investment in Nairobi’s communities instead of contributing to the sprawl with a habitat-disturbing new city. This would encourage grassroots efforts, prioritizing Kenyan entrepreneurship over foreign companies and their financial incentives.
The struggle to mediate urban development with demands from the technology sector is a major issue in each of these cities. Turf battles, demographic shifts and income disparity accompany economic growth in San Francisco and Seattle. In Kansas City and Nairobi, technology hubs lack essential density and political agency. Government plays a central role in how cities respond to the tech industry’s influence — both in creating equitable density or, on the other hand, stimulating sprawl. Effective policy making is at the root of maintaining balance between companies and the neighborhoods they inhabit.