Tech in Downtown Santa Barbara: A Hayes Commercial Special Report

A brief history of tech in downtown Santa Barbara.

Download the full report.

Technology companies have become an increasingly significant presence in downtown Santa Barbara over the past decade. Prior to that, most tech companies gravitated to the suburban office and R&D parks in Goleta. The two main factors driving this migration have been the allure of downtown for tech workers and the increased availability of larger floor plates and spaces near State Street during and since the last recession.

Of course, there were tech companies in downtown Santa Barbara prior to the recent wave, including Green Hills Software, FastClick, Conversant (formerly ValueClick), Softshare, and Multiprobe, to name a few. However, very few of these companies were located on or around State Street in the heart of downtown.

Led by RightScale and Sonos, tech companies began leasing office space in the center of downtown during the recession about 10 years ago. They recognized that the State Street area of downtown provided a lifestyle benefit to tech employees, many of whom value the walkable, amenity-rich environment of State Street over office park features like ample parking and proximity to more affordable suburban housing.

The recession hit the State Street retail sector particularly hard, and the once renowned destination shopping corridor continues to struggle under double-digit vacancy. Recognizing that State Street has a long-term problem of oversupply, companies such as Sonos, LogicMonitor, and now Amazon have converted retail buildings fronting or near State Street to “creative” office space. The repurposing of retail space to office space has generally been well received by the community, especially in the context of recent proposals to adapt or even redevelop some of State Street’s retail property for other uses, including mixed-use residential and office space. Nearly all agree that having more tech employees working near State Street adds dynamism and economic vitality to the downtown area.

Prior to the recession, the downtown Santa Barbara office inventory was almost entirely occupied by professional office tenants, especially in the financial and legal sectors. As many tech companies have been converting retail—and in some cases industrial—space for their use, the impact on professional office users has not been significant, and rents for traditional office space have remained stable.

Tech companies are competing for talent now more than ever. I expect downtown Santa Barbara to continue to appeal to tech employees, and with Amazon moving a large research team to State Street in 2019, there is a lot of momentum for other firms to follow.

About the author: Greg Bartholomew is a partner with Hayes Commercial Group and has completed hundreds of commercial sales and leases in downtown Santa Barbara during his 25-plus years as a broker. He exclusively represents Sonos in all of its real estate transactions in the area. He can be reached at