They didn’t get Amazon HQ2, but the developers and political supporters backing the Port Covington development have landed three tenants for what they envision to be the cybersecurity hub of the country.
DataTribe, a “startup studio” with offices in Fulton, Maryland, and Silicon Valley; AllegisCyber, a Silicon Valley-based venture capital fund specializing in cybersecurity; and Evergreen Advisors, an investment banking company providing services for mid-market firms, are the first tenants to sign on for a new building, due to open in 2020.
The hub will center around Rye Street Market, a 180,000-square foot mixed-used development to be built near the existing Sagamore Spirit Distillery and Rye Street Tavern, that will include a food market, shops and office space. Additional construction could bring Chapter 1 of the development to a possible 3 million square feet of office, retail, residential and hotel space.
To hear the backers tell it, this is just the beginning of the tech center they’re calling Cyber Town U.S.A. Mike Janke, a co-founder of DataTribe, said 30 or more commercial tech firms focusing on cybersecurity will open up shop alongside his company in two years, and it’s possible more will soon be on the way.
“The first wave of tenants represent a sector of the economy that is leading us into the future,” said Marc Weller, a partner of Weller Development Company, the lead developer of the 235-acre parcel in South Baltimore. “All aspects of the technology life cycle will plant the flag in Port Covington.”
For the politicos, techies, venture capitalists and developers present at a press event this morning to announce the deal, the choice of Port Covington–and more broadly, Baltimore–is an obvious one. The area is awash in talent–more than 100,000 cyber engineers and data science professionals, one said–owing to the location of the National Security Agency, Aberdeen Proving Ground and a thriving university community along the I-95 corridor.
Gov. Larry Hogan touted figures that he said place Maryland first in the concentration of science, technology, engineering and mathematics professionals, second in the concentration of information security analysts and third for concentration in research and development workers.
Bob Ackerman, founder of AllegisCyber, said Silicon Valley firms would routinely steal talent from the area and bring it out to California. And then he realized: “We’re pulling these guys out of Maryland. What’s going on in Maryland? We need to check that out.”
What he found was a huge pool of cybersecurity engineers, he said, with many coming from the NSA or launching their own firms after starting out there. It made him transform from a “reluctant envoy from Silicon Valley” to an enthusiastic one and, eventually, a transplant.
Given how much of our lives are transacted on the internet, he said, there’s an ever-present need to secure information online, and a demand to keep developing new technology as more bad actors try to breach what protections are in place.
“So the stakes are really, really high,” he said.
Or as Janke put it, states such as New York, Texas and Georgia are all spending millions to be the epicenter of this technology. But there’s a reason Iowa doesn’t try to compete with Texas when it comes to oil production, and that’s because they don’t have the natural resources below their feet, he said.
“We have the oil.”
Talking with reporters after delivering prepared remarks, both Ackerman and Janke lamented how the Bay Area is becoming a victim of its own success, with the cost of living soaring. While the big shots at Google, Facebook and Apple can pay the crazy rents without having to worry about, it’s harder for a company trying to establish itself that can’t yet pay a salary in the six figures.
While maintaining they are politically neutral, they said the business environment has changed in Maryland over the last several years, with changes in regulations and tax structure making it easier for startups to launch and hit the ground running. And it’s much easier, comparatively, for workers to live in the city, own homes and start families.
They didn’t ask for any tax breaks or financial incentives to start offices in Maryland, nor did they receive any, they said. (Bear in mind that Port Covington will exist thanks to $660 million in tax increment financing from the City of Baltimore.)
Asked about the possibility of a change in the governor’s office, they remained bullish.
“Just let us do our thing,” said Ackerman.
“Just let us do our thing,” Janke echoed, adding, “and keep the environment the same.”
By every indication from this morning’s announcement, they need not worry. Many of the speakers talked about the collaborative effort from all the major players to get this cybersecurity hub on the tracks, a bonhomie between the politicians, engineers, developers and people with equity.
“The election’s gonna be over soon–thank God,” said Congressman C.A. “Dutch” Ruppersberger. “My philosophy, when the election is over, you work together. And up here, each of us have had a little bit to do with this–you’ve got two Democrats and a Republican, talking about growth in our area, in our city and our state.”
Hogan took the opportunity to tout his administration’s investment in the city totaling, he said, $5.5 billion. He said it’s the most by any governor in the history of Maryland, “because a vibrant Maryland depends on a stronger Baltimore City, and Port Covington is a shining example of the potential and positive growth that this city needs.”
Mayor Pugh thanked the governor for his “continued partnership” and also thanked Margaret Anadu, managing director of the Goldman Sachs Urban Investment Group–the firm invested $233 million into the Port Covington project.
Standing in a tent outside Rye Street Tavern, Pugh fondly recalled meeting with another Goldman executive while she was in New York for a conference.
“Your president at the time stood up and said, ‘I’m not just investing in Baltimore’s leadership, I’m investing in Baltimore because I’m going to make money.'”
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