Presented by Downtown STL Inc
A Core Commitment: What’s Next for the Downtown St. Louis Innovation District
St. Louis has begun to make a name for itself in the world of high-tech and IT entrepreneurs. Here's the latest on the role Downtown St. Louis plays in propelling our city's innovation community forward.
“Downtown has changed a lot in the past few years,” says Melissa “Missy” Kelley, President and CEO of Downtown STL, Inc., the nonprofit dedicated to creating and promoting a vibrant Downtown which attracts investment and economic activity to the region. While she could be referring to the unveiling of CityArchRiver, the launch of the National Blues Museum or the opening of The Field House Museum, —all of which happened in 2016 alone— Kelley is referring to much more than physical spaces and real estate development.
She’s referring to indicators of a bigger movement: one that is drawing in the city’s innovation community.
In recent years, St. Louis has begun to make a name for itself in the world of high-tech and IT entrepreneurs. The Gateway City’s start-up scene has been praised by the likes of FiveThirtyEight, Forbes, TechCrunch and The Wall Street Journal, and its increased national visibility is making St. Louis one to watch for technology jobs.
Indeed, out of all metro regions in the US, FiveThirtyEight found that St. Louis had one of the fastest growing rates of startup formation (with two other cities in Missouri also in the top 10).
Much of that growth could surely be due to the fact that over the last seven years, incubators and accelerator programs have launched across St. Louis with the vision to increase the economic vitality of the region via its innovation community. Since its founding in Downtown St. Louis, the T-REX Innovation Center has graduated 56 companies, and has almost 200 companies housed in its incubator and co-working space currently.
Along with a number of entrepreneur support organizations, T-REX has nurtured startups that have brought not only advanced technological development to the Downtown area but also the highly skilled workers needed to turn those big ideas into reality. Given that 11 of the 56 T-REX alumni have kept offices Downtown and together employ nearly 200 people, it’s easy to see the impact the startup incubator is making on St. Louis’ Downtown neighborhood.
Inspired by this growth, and understanding the importance of building density to create a robust innovation district, Downtown STL, Inc. worked with leaders in the tech community to set a goal in the fall of 2015: to draw an additional 1,000 innovative companies and 10,000 new workers Downtown by 2025.
“The innovative district wasn’t planned but grew up around the entrepreneurs who were living there, and now it’s giving Downtown, as a business district, a new identity – an opportunity to redefine itself around innovation and startups.”
From World’s Fair to World Tech
Downtown St. Louis is one of the fastest-growing neighborhoods in the region. According to the Downtown STL, Inc. 2016 Housing Survey, in the last year alone, the Downtown area saw a 7% growth in residential population, and Kelley says a significant number of those residents include workers from the innovation community.
The hope is that this trend continues, and as Kelley is quick to point out, Downtown has a long history in attracting innovators.
In 1904, the St. Louis World’s Fair brought new technology, innovation, and scientific discoveries to the city. Many of those discoveries paved the way for inventions that have become an integral part of our culture today – the electrical outlet plug, X-ray machines, stunning local buildings and even the ice cream cone.
“The city’s history is built on innovation. At every evolutionary step of the city, Downtown St. Louis has been at the center of the area’s innovation.”
Downtown has been home to steamships and barges. There were foundations for trading companies right on Laclede’s Landing.
The fur trade was a massive industry, then came the railway exchange. Kelley sees what is happening Downtown today as simply a continuation of the city’s innovation story.
“What we’re seeing right now,” Kelley says, “is a resurgence, from very large companies to more nimble startup companies. We have in St. Louis both a presence of large companies like Peabody, AT&T, major law firms as well as a mix of middle-sized companies and startups that give us a great balance for Downtown’s economy.”
Tech companies like SafeTrek, who partnered with Downtown STL in 2016 to improve safety in the area, and LockerDome, who is hiring 300 more workers and moving into a bigger office space, are building on the city’s foundation of innovation.
It was big news for Downtown in 2016 when the National Geospatial-Intelligence Agency announced it will move its western headquarters just north of Downtown St. Louis. The St Louis Fashion Incubator, located on Washington Avenue, is nurturing fashion entrepreneurs and adding to an established arts community in St. Louis.
Despite all this, the goal of adding 1,000 new innovative companies and 10,000 new workers Downtown by 2025 is a big one.
Where St. Louis Thinks Big
The idea of setting a specific goal around companies and jobs Downtown originated with LockerDome CEO Gabe Lozano. “In order to spur economic development, we need to build an attractive community for entrepreneurs and founders,” says Lozano.
“What I think is important about that goal,” adds Kelley, “is that it came together organically from the startup community, from working with organizations like ours and Cultivation Capital, and other supporting services.”
“And we’re all working together to make it happen. That’s the kind of thing that takes place in an urban core where there’s a lot of people focused on growth and making it a more inviting place.”
Simply put, it’s a goal that people can get behind. And the numbers are already starting to grow. Mobin Khan, economic development and research consultant with Downtown STL, Inc. says, “At the end of 2015 we had over 260 innovative companies and 4,000 workers.”
He doesn’t seem daunted by this new goal. “The spirit of innovation here pervades across industries,” he explains. “When we use the term ‘innovative companies’ we define and include anyone who is generating ideas and bringing them to market.”
It also helps that there is a large talent pool in the area. In total, there are about 90,000 workers and over 3,000 businesses in Downtown.
Khan explains that even if a startup does not survive or moves away from St. Louis, the talent tends to stay in St. Louis.
“One example is Gainsight. They started in St. Louis but have now moved their headquarters to San Francisco.”
“But they liked Downtown St. Louis and the people here, and started another company here called TopOPPS. Regardless of a company’s span of evolution, we tend to retain that pool of talent because they love the ecosystem of Downtown.”
Momentum Worldwide has moved from Clayton to Downtown near Union Station. And the Federal Reserve will add over 200 jobs, though it’s not clear if all of those will be Downtown.
Khan cites the accounting firm KPMG as an example of the quality of talent in St. Louis. In 2015, the firm announced plans to hire 175 tech workers, all based Downtown.
“With many of their offices across the country, KPMG searched for the perfect location to house their IT department. St. Louis won because our talent pool was richer.”
Kelley says that in order to reach the 2025 goal, committees led by representatives of several Downtown companies have already been set up to work on programming, infrastructure and financial projects. The expected increase of people and businesses brings with it an increase in needs–real estate, hotels, retail and services–and $1 billion worth of new developments are already on the horizon.
“If we want to scale up, we have to put things in place to support that growth,” says Kelley.
A Downtown To Write Home About
With growth comes the need for places to house the new companies and their workers.
Ballpark Village phase 2 will be a mixed use development of residential, retail and office space. Green Street’s building at the corner of Jefferson Ave. and Market St. will add 55,000 sq. ft. of tech-enabled office space.
Additionally, two substantial redevelopments of existing buildings are taking place at Jefferson Arms and the Railway Exchange, both of which will be mixed-use residential, retail and hotel with a bit of office space. The plan is to add over 1,000 residential and hotel units in the next 3-5 years.
T-REX itself is also planning renovations. In 2016, the nonprofit announced an $8 million capital campaign, which will go toward finishing out raw and underutilized space to provide more space for startups, create new production spaces and building out a rooftop patio.
Patricia Hagen, PhD, T-REX’s executive director, says they are cognizant of the types of sustainable, creative spaces in which the emerging workforce is highly interested.
“In many ways we are responding to the desires of a generation who will be the leaders of St. Louis in a very short period of time–if they aren’t already,” Hagen told EQ when the capital campaign launched. “The way they want to work and where they want to work—we all need to pay attention to these changes in our culture.”
With a walkability score of 92 (the highest in the region, awarded by Walk Score), Metro and mass transit, 160 restaurants and nearby entertainment areas like Grand Center and the Midtown Business District, Kelley says St. Louis’ Downtown offers a real urban experience. And with the influx of new residents, Downtown STL, Inc. wants to continue to build an environment that is conducive to urban living.
“We look at this existing innovative community and ask ourselves how we can best serve them. We want to provide the people living Downtown with the amenities that they’re looking for,” says Kelley.
Some of the amenities in the works are improved street lighting, gigabit fiber, Smart City initiatives and the CityArchRiver project.
“It’s going to be like having a Forest Park in the middle of Downtown,” Kelley says. “From the perspective of a resident and for people who work Downtown, these projects will provide great green space for them to enjoy.”
The thought is to create ways and places for people to enjoy the live/work/play lifestyle that many of the Downtown innovators desire.
More people also means a greater demand for things like high-speed internet. Luckily for Downtown workers, gigabit fiber is in the works.
Khan says, “In partnership with the City of St. Louis, our goal is to bring high-speed broadband connectivity (at least 1G per second) to our residents and businesses. We need high-quality data in order to be competitive both nationally and globally. If we’re building this innovation economy, all of our startups need to have a level playing field across the board, and gigabit fiber needs to be available at an affordable price point.”
The gigabit fiber project is part of an overall Smart City initiative. The US Department of Transportation announced a Smart City challenge, and St. Louis put in an application in the Spring of 2016.
As a Smart City, St. Louis would use technology and data to enable a better functioning city for its residents, encompassing anything from traffic to policing to citizen services and communication. Another component to the Smart City initiative is Downtown STL, Inc.’s #LightMySTL initiative.
Kelley notes two goals with this project: “First, to help establish a sense of place for Downtown. The style of the lights, as well as the colors, can be changed to match events like Cardinals or Blues games going on Downtown.”
“It will give that sense of place to the area. We also want to make Downtown safer.”
“The Smart City component would be the cameras on the light poles that will connect to a website that tells the city when lights are down. The white LED lights will also create clearer and more easily identifiable images on safety cameras as well as providing light on both streets and sidewalks.”
As the largest revenue generator in the St. Louis region, a vibrant Downtown is vital to our city’s future. What happens there is very important to the rest of the City of St. Louis and to the greater region.
But Kelley stresses that, “Downtown cannot achieve its greatest potential without the support of the rest of the city and the rest of the region. That means that it’s important to look beyond just technological innovation to things like the world-class arts and cultural amenities we have in Grand Center, Soulard, the cultural innovation on Cherokee Street.”
“We have to think beyond Downtown when we’re thinking about growth. The surrounding areas have to support one another and work together.”
“If we invest in the spine of St. Louis (from the Arch to Forest Park) it will help to feed the tax base and infrastructure for all of the surrounding neighborhoods and can bring out the best of what the city has to offer.” Kelley cites Cortex as a great example of this cooperation.
Founded in 2002 as a partnership between Washington University, Saint Louis University (SLU), University of Missouri-St. Louis (UMSL), BJC Healthcare and the Missouri Botanical Gardens, Cortex has grown from a single building on Forest Park Ave into a 200-plus-acre campus that is now home to over 3,600 people working in an intentionally diverse mix of startups and larger, established firms.
“Cortex is one of the best things to happen in St. Louis,” says Kelley. “They are helping to build St. Louis’ reputation as an entrepreneurial city. We’re finding great ways to work together to develop innovation, diversity, education and the arts in St. Louis.”
Given the current growth of all three of St. Louis’ core innovation districts–Downtown, Cortex and the newly named 39 North AgTech District in St. Louis County, there’s no doubt the focus will be on recruiting investment into the city as a whole. But Downtown has much to look forward to in 2017.
“I’m very excited about pushing forward the vision that the best of everything is Downtown,” Kelley says. “My goal is that Downtown will be the best neighborhood in St. Louis; the best place to go for entertainment, the best place for diversity and the best for innovation and business in the region.”