Silicon Valley 2014 economic forecast: Talent crunch, M&A uptick, development sprawl

Christy Wyatt, CEO of Good Technology Inc., said at the Business Journal's 2014 Economic Forecast that recruiting and retaining talent is her company's top challenge for the year ahead.

With her mobile device management company heading toward a long-rumored IPO, Good Technology CEO Chisty Wyatthas one key potential roadblock on her mind:

“Talent, talent, talent. It’s the lifeblood of what we do,” Wyatt said on Wednesday at the Business Journal’s annual economic forecast.

Good Technology already employs more than 1,000 people, but Wyatt said the 18-year-old company views recruiting as an issue that requires more than high salaries. The company mapped transit options in various Silicon Valley cities and put down roots in Sunnyvale in hopes that they wouldn’t “miss out” on tech talent that has plenty of employment options — some of which include incentives like private charter buses, housing subsidies, free food and other over-the-top perks.

“Silicon Valley is unusual,” she said. “What motivates the key talent in the Valley is never their paycheck.”

Competition for talent prospects was one of several employer issues at the event that reflect side effects of a rapidly improving regional economy. While most economic indicators point to continued growth in 2014, the region is also at an inflection point for managing that growth.

“California seriously is the place to be,” said City National Bank Director of Taxable Fixed Income Paul Single. He highlighted Los Angeles and the Bay Area as state’s economic drivers.

While the last year was the best for IPOs since 2007, speakers said this year shows promise for the mergers and acquisitions market.

On the ground, economic growth will likely manifest with another busy year for real estate developers. As perennial strongholds like Palo Alto and Mountain View look to maintain momentum, developers are also circling lesser-known cities like Santa Clara and Redwood City for dense mixed-use projects.

The real estate boom could also push some existing companies out of the Peninsula and pricier South Bay markets. San Jose neighbor Milpitas and Fremont are two potential candidates to cash in on higher prices in better-known employment hubs, said Cushman & Wakefield Regional Research Director Petra Durnin.

Steve Eimer, executive vice president at real estate developer Related California, outlined his company’s hopes for a 230-acre development site across the street from the San Francisco 49ers’ new $1.3 billion Santa Clara stadium. Related is still studying the site, but Eimer said a proposed entertainment district could include up to 1,000 housing units.

“We’re in it for the long term,” Eimer said. “If all goes well, we would like to be under construction in late 2015, early 2016.”

With all the activity going on in neighboring Santa Clara, San Jose City Manager Ed Shikadasaid he sees “opportunities for synergy” between Santa Clara, downtown San Jose and the tech office-heavy North San Jose area.

Read more about today’s Economic Forecast in an upcoming print publication of the Silicon Valley Business Journal.

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