Skip to main content

2019 IPOs Affecting Real Estate In SiliconValley


For decades now, Silicon Valley has been considered the center of the tech world when it comes to innovation.Propy

Major brands including Uber, Lyft, Slack, Pinterest, and Airbnb are predicted to IPO this year which could result in new wealth, not only for cities where these companies are headquartered but surrounding cities as well.

The knowledge and tech economy — universities, start-up industries, innovation hubs, and parks — have always been key drivers of future growth. For decades now, Silicon Valley has been considered the center of the tech world when it comes to innovation. This has resulted in Silicon Valley housing being one of the highest priced real estate markets in the United States, if not globally. And it looks like 2019 may exacerbate that.

Uber, Lyft, Slack, Pinterest, and Airbnb are predicted to IPO this year which could result in new wealthPropy

When tech Unicorn startups, like Uber, finally go public, they will likely be worth over $100 billion, putting at least $10 million in stock for every early employee, advisor, and investor. In addition to the startup ecosystem, the real estate landscape will also be affected. Back in 2004, Google’s IPO played a role in the 11% increase in prices in the San Francisco and Bay Area. The economic success of the region, especially it’s recovery after the great financial crisis, has generally tended to push prices up. Another example is Facebook. It’s IPO helped its employees make significant down payments on mortgages and early employees invested in more than one single-family homes. While Facebook chose a historically poor area for its HQ, the prices of the neighboring Palo Alto and Menlo Park went soaring after the company went public.

The post-IPO availability of cash is in stark contrast with the continuing cooling down of the U.S. real estate market as a whole. Along with IPOs, company expansions in certain areas can also affect the real estate price and rental momentum. Interest and property prices in New York saw a significant increase in Long Island City when in November the news broke that Amazon would build a vast campus for its headquarter. But what we may expect after the company recently announced their decision to drop the expansion plans in New York? Following the euphoria and the tremendous property searches, now sellers are worried whether the market will react negatively, and agents, on the other hand, feel insecure for the deals already in progress.

While 2018 was a rather crazy and fast “seller’s market,” it is expected that things will be a little different in 2019 as buyers and sellers adjust to the new realities. Meanwhile, if the upcoming IPOs happen before Q3, new cash buyers will target not only prime Silicon Valley areas, such as Atherton but also vacation places like Tahoe and even affordable European properties. One thing is for sure, 2019 will be one of the most exciting and dynamic years for Silicon Valley real estate.


2019 IPOs Affecting Real Estate In SiliconValley curated from Forbes - Real Estate

Comments

Post a Comment

Popular posts from this blog

Vacation rental company Vacasa buys Sterling Resorts

Vacation rental management tech startup  Vacasa  isn’t slowing down its ambitions to conquer the market: this week, it announced that it has purchased Sterling Resorts, a vacation management company on Florida’s Gulf Coast. Sterling has changed hands before: it was  bought by Pacifica Companies in 2015 and currently manages 450 homes. Now it will become a part of Vacasa’s effort to expand its presence in vacation destinations such as northern Florida, where Sterling is based. At the time of this latest purchase, Sterling’s home inventory was  down from 585 properties in 2015. Vacasa has raised more than $200 million since its launch ten years ago. Founder Eric Breon said he was motivated to start the company after struggling to find a satisfactory management solution for a cabin belonging to his wife’s family on the Washington coast. Now Vacasa seeks to provide rental property owners with “a seamless experience…through innovative technology and local staf...
Post a Comment
Read more

In An Era Of WeWork, Co-Working Space NeueHouse Sits Above The Fray

NeueHouse CEO Josh Wyatt Seuss Moments In today’s cluttered co-working landscape, it can be hard for companies to makes themselves heard over the din. Elevated co-working space  NeueHouse  wants to create an unparalleled experience for creatives through elevated programming and outstanding design. NeueHouse describes itself as “ a private cultural and collaborative space for prominent creatives, artists and entrepreneurs,” with current locations in Los Angeles and New York. In November, following an announcement of $30 million in funding , the company announced Josh Wyatt as its new CEO. Wyatt is a veteran of the hospitality industry, having co-founded Generator  in 2007, a chain of culture-focused hostels targeted at millennials, before moving on to Equinox to head the fitness brand’s hotel developments in New York City. Forbes interviewed Wyatt to talk about creativity, design, the gun threat incident at NeueHouse New York, and why he i...
Post a Comment
Read more