By HILARY POTKEWITZ
Would $5,000 be enough to lure you to Riverside?
On top of that, throw in free Internet access, a reduced mortgage and 30% off utility bills.
In Riverside, a city better known for its smog and the historic Mission Hotel, the focus is on luring technology companies from Orange County and Los Angeles.
Even credit unions are on board, with Altura Credit Union and Arrowhead Credit Union planning to offer the possibility of one percentage point off a qualifying mortgage rate, or offering to cover closing costs on a house for relocating tech workers.
“We’re trying to become more of a high-tech community,” said Steve Reneker, Riverside’s chief information officer.
Riverside sits on major fiber-optic lines of AT & T; Inc. and Charter Communications Inc.,the “broadband freeway” in Southern California terms, Reneker said.
“Plus, we’re about an hourish from anywhere,” he said.
City planners are working on an effort to revamp Riverside’s image. The city put out a request for proposals for a company to provide free wireless Internet service citywide.
It also passed an ordinance requiring housing developments to include broadband lines to bring high-speed Internet to each house.
Tunnel Factor
The plans are as much an issue for OC as they are for Riverside. For one, Riverside is eyeing OC companies that might look east for cheaper business costs and housing.
Then there’s the tunnel.
The Inland Empire’s development of higher paying jobs has become part of the debate over building a $12 billion tunnel linking Irvine and the Inland Empire as a way to relieve chronic congestion on the Riverside (91) Freeway.
Irvine Mayor Beth Krom and other tunnel opponents advocate developing high paying jobs in Riverside and elsewhere in the Inland Empire to cut the need for a tunnel.
The city has a way to go.
“Riverside faces a fundamental image issue,” said real estate economics consultant Larry Kosmont. “Tech companies tend to employ what I call the ‘Starbucks caf & #233; latte crowd.’ And Riverside is still thought of as a residential and blue-collar industrial town.”
The city of 285,000 people is competing for jobs with other Inland Empire cities such as Ontario and Rancho Cucamonga, which have lured companies with more affordable real estate prices.
The median home price in Riverside is $415,000, compared to $628,000 in OC. Office space runs cheap,about $1.85 per square foot, versus $2.30 in OC.
Some small companies have made the leap.
Helen Chen moved her biotechnology company from Irvine to Riverside last year. With five people working on obesity drugs, Ambryx Biotechnology Inc. was losing its office space near the University of California, Irvine.
Chen had specific needs: She wanted to be near a university, she needed laboratory space and a flexible lease.
“The nature of biotech is that we don’t know how long we’re going to be around,” Chen said. “We didn’t want to sign a five-year lease.”
Irvine had become too expensive, Chen said. She said she figured her other option was San Diego, but that would have been too far for her workers.
There also was the issue of establishing a relationship with a university.
“UC San Diego probably has a thousand other companies lined up,” Chen said. “They’re not as inclined to work with us. UC Riverside is in a smaller community, and they were very willing.”
Reneker is quick to point out that Riverside has three other universities and a student population of 40,000. Tech companies take note: There are more than 6,000 students in engineering programs.
The city has put aside $50,000 for relocation incentives for tech workers, which, at $5,000 per employee, isn’t a lot.
The account is expected to swell to $250,000 in the next couple of years, according to Gregory Lee, the city’s tech business development coordinator. The campaign is targeting smaller companies.
Chen moved to Riverside and bought a house. She said she’s still waiting for her relocation incentive to come through. But she’s thrilled with the move. Ambryx just renewed its one-year lease.
Other biotech executives sometimes give Chen funny looks when they find out she’s based in Riverside. But for a small company, “sometimes it’s more important for us to keep light on the financials,” she said.
Amro Albanna founded Qmotions Inc., a maker of motion controllers and accessories for video games, in Riverside in 2003.
“We’re the only video game company out here,” said Albanna, the company’s chief executive.
Albanna said he’s had success hiring tech workers for his 15-person company, especially people who don’t want to commute to OC or Los Angeles.
Being near the university also is a plus, he said. Even the distance from video game companies in Irvine and Santa Monica doesn’t bother him.
“We really don’t look at ourselves as an isolated island,” he said.
The incentives Riverside is offering,cash, reduced mortgages and utility bills,can start to affect business decisions when the formula is right, according to Kosmont.
“There is a tipping point where someone says ‘that’s a good deal,’ particularly for new companies,” he said.
Potkewitz is a staff writer with the Los Angeles Business Journal.
