Tech Companies, Millennials Head To Downtown Phoenix

Published: Thursday, January 14, 2016 - 4:42pm
Updated: Thursday, January 14, 2016 - 5:13pm

(Photo by Lauren Gilger - KJZZ)
You won’t find any cubicles in Yazamo’s open offices.

In the new downtown Phoenix offices of tech startup Yazamo, young professionals click away at Apple computers in a high-ceilinged, loft-like room lined with big windows.

“Natural light was huge for us,” said Lindsey Ingalls, client success manager at Yazamo.

“No cubicles; it’s all one big office space,” she said, as her mastiff-boxer mix, Reagan, followed her around the new 3,000 square-foot office in the historic Heard Building downtown.

The company was launched about four years ago by two Arizona State University students, Ingalls said. They specialize in lead generation, meaning they create Facebook quizzes that you click on and take. Then, when you put in your name and email address to see the results, “That name and email gets added to our client’s list,” Ingalls said.

“So, we’re creating a lead for them, which is somebody that they can market to and sell their products to,” she said.

The company now has nine full-time employees, she said, and they expect to triple in size this year after they launch their Lead Quizzes software this month. And, as they expand, Ingalls said their new, open office space – and its downtown location – is important to their growth.

When they tell people they work downtown, she said they always get a good reaction. “That’s one of the first things that we hear from people,” Ingalls said, “’Cool, I can light rail, ‘Cool, I don’t have to worry about parking,’” she said.

“It really has drawn people our age,” Ingalls said.

She said the oldest person working in their office is 27. Those young, educated millennials are exactly who businesses are trying to attract, according to David Krietor, president of community development group Downtown Phoenix, Inc.

The Heard Building, where Yazamo’s new offices are located, is one of the oldest high rises in Phoenix. And now, Krietor said, it’s being redeveloped into an office building for tech, design and creative companies.

Along with Yazamo, architectural firm Winslow and Partners moved in recently, and Booking.com will open an office there soon.

“We’re getting a lot of interest from those types of firms in downtown Phoenix because they’re basically following the people,” Krietor said.

Phoenix is experiencing a sea change right now, like other major cities around the country, Krietor said.

There are 80 million people in the United States that are now millennials, he pointed out.

“Unanticipated by a lot of us that have been involved in redevelopment for a long time, it’s become an increasingly urban generation,” he said. “We thought that they were going to follow their folks – the baby boomers – out to the suburbs, and it hasn’t happened.”

That demographic shift, along with 12,000 students from ASU and the University of Arizona, a trailblazing arts community, a few sports stadiums, and the light rail, and you’ve got the ingredients for a truly urban city center, Krietor said.

At the same time, he said there is a housing boom happening in the area that wasn’t anticipated, with 2,000 units of new residential being constructed downtown.

2015 saw a trend of technology companies and startups heading downtown, including Uber, Galvanize, Allbound Inc., Gainsight Inc. and Inspire Data Solutions, according to Downtown Phoenix, Inc.

Like the Heard Building, the historic Luhrs City Center was recently renovated. Now, that building is home to venture company Tallwave, which launched a startup incubator called HighTide there.

The City of Phoenix’s Business Attraction Program encourages building owners who traditionally have catered to corporate entities or law firms to re-think their space and make their buildings more attractive to cutting-edge firms, according to the program’s manager, Phil Bradstock.

According to the Center for Entrepreneurial Innovation at Gateway Community College, 12,000 new tech jobs were added in Phoenix from 2012 to 2014 and $243 million was invested in Phoenix companies in 2014.

According to Ingalls, one of the main reasons they wanted to move downtown was to be around people and companies like them.

And, she said, the accompanying night life, restaurants and bars have changed downtown for the better in recent years.

“Something I heard the other day is Phoenix is becoming the new Austin,” she said. “There’s live music you can go to every night in downtown, and there’s restaurants, and just the atmosphere is really cool.”

It’s that cool factor that Krietor said has been a long time coming.

“I think that there was a lot of skepticism about if this place, the most suburban of metropolitan area in the United States, could ever develop an urban core,” he said. “And I think everybody, now, 100 percent believes that. You can see and feel that every day."

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