It's no surprise to anyone that cybersecurity is a hot industry in the D.C. metro area right now.
But what we might overlook at first glance is the impact the growth plays in the local real estate game. Commercial real estate agency CBRE knows the growth all too well. The company notes that with the growing cyber industry, they've seen a spike in demand for their Cybersecurity Consulting Services along the Baltimore-Washington corridor to find the right office space for local cyber firms.
"There is an infrastructure that exists in the Maryland-Virginia-DC community," said John Redeker, senior associate at CBRE. "The infrastructure is heavily leaned towards the federal government and that infrastructure provides a few different things that nurture the cybersecurity sector."
Started almost two years ago, the service is headed up by Redeker and fellow senior associate Jonathan Hall. The group works with incoming cyber firms to find the best location for their growing business: Where is the best place for their employees to work? How close is the new office to potential customers? Is the office space open enough? Most recently, they've worked with firms MKA Cyber, which recently expanded to Fairfax, Va.; Sealing Technologies, which recently relocated its headquarters to Columbia, Md.; and Cybraics, which recently expanded its Arlington operations.
D.C. doesn’t have a specific strategy that they set out that calls out cybersecurity companies, the same way that the Commonwealth of Virginia and Maryland does.
More often than not, the pair says they see cyber firms that want to fight back against the idea that a cybersecurity company has to work in a dingy, dark cubicle office. Companies want to invite collaboration in the workplace through open work places, bright lighting and exposed ceilings. "The executive teams, while they need private areas to have confidential conversations, they want to be out there and engaging with their employees as much as possible," Hall said.
And it seems that more companies are looking to settle outside the confines of D.C. Proper, opting to work closer to clients in Maryland or Virginia. "Very few are focused in downtown D.C. D.C. doesn’t have a specific strategy that they set out that calls out cybersecurity companies, the same way that the Commonwealth of Virginia and Maryland does," Redeker said.
"If you look at D.C., they have a tech corridor and a general tech incentive—it’s not really specific to cyber. For Northern Virginia, a big driver is your access to your cyber pool. For Maryland, it’s the home of DOD, NSA— you have the talent coming out of those agencies that the state hangs it head on."
According to a recent Q1 report from CBRE, the tech sector overall is continuing to drive demand for space in Virginia, expanding by more than 100,000 sq. ft. in the first quarter. At the same time, the federal government continued to play a smaller role, losing 160,000 sq. ft. of occupancy. Meanwhile, in Maryland, government activity contributed to 165,000 sq. ft. of growth in the state—mostly due to the FDA signing new leases in Beltsville and Calverton.
"They’re in a great place to attract these companies. At the end of the day, it’s going to be the eye of the beholder."
CBRE expected the specific cybersecurity demand one day, which is why it established its consulting services; however, they say the service is growing more and more each day. With more cybersecurity firms coming to the DMV, the team hopes that the region capitalizes on it.
"I hope as a region government officials can come together and promote the Mid-Atlantic as a cyber hub as opposed to making it D.C. vs. Maryland vs Virginia," Hall said. "I think they’re in a great place to attract these companies. At the end of the day, it’s going to be the eye of the beholder."
And ultimately, when you look at the trends in the D.C. metro area's innovation scene, the growth of cyber and the demand for more office space in the region isn't so surprising, Redeker says.
"If you look at some of the other industries that have become dominant in the D.C. area— the two that come to mind are the burgeoning tech scene and the defense presence," he said. "Cyber isn’t truly technology and it’s not truly defense—It's at the crossroads of tech and defense. The cool part about what we do is that we get to help these entrepreneurs that are starting these companies to create a sense of community for their employees and culture."
Images courtesy of CBRE
