Report Outlines Transformation, Innovation and the Pursuit of Excellence that Underscores Pittsburgh’s Rightful Place in the Global Technology Arena
Pittsburgh, PA – Cushman & Wakefield announced today that the real estate services firm has released a new comprehensive report delving into the multifaceted landscape of Pittsburgh’s Robotics and AI sectors, offering an in-depth exploration of key aspects that shape the city’s technological identity.
“Pittsburgh has emerged as a dynamic hub for innovation and technological advancement, with a burgeoning ecosystem in the realms of Robotics and AI,” said Steven Patterson, Research Analyst for the Pittsburgh market. “Historically known for its steel industry and blue-collar economy, the Steel City has undergone a remarkable transformation into an internationally recognized hotbed of innovation and entrepreneurship.” The report, titled “Unveiling the Robotics and AI Landscape in Pittsburgh,” explores how local universities have acted as a catalyst for this transformation; considers how the commercial real estate inventory has supported, and can continue to support, this transformation; reviews current technology companies in the Pittsburgh area, looking at which industry verticals and horizontals are receiving the most funding and how the funding picture in Pittsburgh has shifted over time; and comments on real estate decision making of technology companies and how funding received directly impacts real estate leasing decisions.
Local universities Carnegie Mellon and the University of Pittsburgh are key contributors to the region's robotic and AI innovation, producing top-tier talent that helps fuel the local industry. Consequently, startups tend to cluster near these universities, resulting in a high concentration of companies in the Greater Downtown, East End and Oakland Submarkets.
“57.9% of Robotics and AI companies in Pittsburgh have connections to Carnegie Mellon, showing the significant role our educational institutions play in driving innovation,” said Patterson.
Pittsburgh is home to a mix of startups, notable homegrown tech companies and internationally recognized tech giants like Google, Apple and Meta.
"This diversity showcases Pittsburgh's potential and serves as a proof of concept," added Patterson.
Robotics and AI firms based in Pittsburgh have become a focal point for international funding. Since 2010, there has been a consistent rise in Venture Capital funding, with Robotics companies receiving 51% while 30% has been directed towards AI companies. Unsurprisingly, medical technology companies witnessed a surge in funding from 2020 to 2022, aligning with the global pandemic.
According to Cushman & Wakefield’s report, there is a positive correlation between the funding received and the amount of real estate space leased, down to the class of the building chosen, as well as the number of employees hired. This indicates that the influence of external funding extends beyond just R&D expansion.
"As the funding increases, we see a direct impact on the square footage leased. For instance, companies with less than $1M in funding occupy 6,222 sf on average, while those with more than $25M occupy 21,889 sf on average," said Patterson.
Robotics companies primarily occupy warehouse and flex space, while AI and other tech companies predominantly use traditional office space. To accommodate the needs of these growing tech firms, several premier tech buildings have been established recently. These facilities, designed for robotics companies, offer open floor plans for testing, ample power capabilities and top-tier office space.
“Pittsburgh’s real estate market for the robotics and AI industry is diverse and supportive, with a range of space types available, from top-tier R&D and office space to flex and industrial space. The region also offers ample opportunities for redevelopment and expansion, with promising economic, labor and real estate fundamentals. Our team is poised to advise these robotics and AI occupiers at each stage of their corporate life cycle,” added Sam McGill, Managing Director in Cushman & Wakefield’s Pittsburgh office.
The full report can be downloaded here.