Some tech companies head outside Pittsburgh’s city limits to gain space, save on rent.
The headquarters of IAM Robots sits between a set of train tracks and the Ohio River. The address is Sewickley, but the scene is removed from the chic shops and restaurants associated with the tony ZIP code. The concrete building is a warehouse whose previous tenant was a Two Men and a Truck moving franchise, and it is sandwiched between an auto repair shop and a company that installs amphitheaters. Just a logo outside indicates that this is a robotics company — one that seeks to overhaul the picking and sorting in companies’ warehouses utilizing mobile robotic arms.
The fact that the company of about 50 employees is in a warehouse might be fitting, but, of course, there are practical reasons for that.
“At this stage, the company was looking for a low-cost lease,” CEO Joel Reed said, adding that “the building owners are very amenable to changes to the environment.” The company has removed walls and resurfaced floors for more space to test its robotics systems.
As Pittsburgh’s robotics industry expands, some companies have stationed themselves outside city limits, away from talked-about developments like the Hazelwood Green and hip locales like the Robotics Rows of Lawrenceville and the Strip District. Some seek out more space and lower rent, sacrificing an image of coolness and some ease of access to the city’s talent pool. Some are content with their suburban digs, while others consider their current station a stepping stone as they grow.
Reed said that though the riverside space has served them well since 2015— and is a vast improvement over the rented spot in a municipal garage where two co-founders started the company in 2012 — IAM is looking to relocate to the city proper in the next year.
“We want to increase our access to talent and we want to have that proximity to the universities,” Reed said.
“A lot of companies are like this,” he added. “At one stage, it doesn’t make sense to rent space in a high-rise.”
About 20 miles north of the city, two robotics manufacturers have headquarters in the industrial parks of Warrendale. They are there for different reasons: RedZone, which makes monitoring equipment for sewers and sanitation systems, could no longer afford the rent in Lawrenceville, after 11 years in the neighborhood, and moved earlier this year. Neya Systems, a maker of autonomous vehicles, has existed in the North Hills since the founding of its processor company 10 years ago.
Most of Neya’s 50 employees live in the northern regions of Allegheny County, according to company president Mike Formica. “We have an older demographic,” he said. “Cranberry is a large growing area. People are coming from Butler and the North Hills.”
The location offers plenty of space and easy access to a test-driving range in Butler County. Formica said the company recruits younger workers and interns from colleges, sometimes saddling them with a long commute. “I haven’t seen anyone not take the job because of the drive,” he said.
RedZone is still getting used to being in the suburbs. “It works,” said John DePasquale, sales operations manager. “We’ve got a big loading dock.” The space is double the size of its rented Lawrenceville location, and it’s easier to move equipment onto and off of the highway.
Still, the move was not without its costs. Some employees, highly trained and desirable skilled workers with many options in Pittsburgh, did not go along. DePasquale doesn’t think the company has had trouble recruiting new people because of the remoteness of the space, however
Other robotics companies feel their suburban stations are less suitable. Aptiv, another developer of autonomous vehicles, grew to take ownership of a cluster of buildings near Blawnox, not far from Route 28. It is moving out of that mini-campus to a spot in Mill 19 in the Hazelwood Green site, which the City of Pittsburgh and private entities are hoping to make a tech mega-hub.
“I wanted to be closer to downtown; I wanted to consolidate into an integrated facility,” said Karl Iagnemma, Aptiv’s president of autonomous mobility. The current campus fits 200 employees, he added. The Mill 19 space houses 400, positioning the company for long-term growth.
Miranda Hlaing, senior marketing and communications manager for Aptiv, said that the creative synergy of being near other creators — and in a brand-new building outfitted with high-tech features like solar power and internally recycled water systems — should facilitate that momentum better than the older, more remote buildings on the other side of the Allegheny River from Pittsburgh.
It’s also a matter of atmosphere. “Our companies live and breathe this stuff,” she said.