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Tech It To The Streets

Technology zones are taking the country by storm.

In many respects, Winchester, Virginia, is just another of the growing number of small cities nationwide competing for the hearts and dollars of the exploding technology sector. But what distinguishes this picturesque town of about 23,000 is its recently designated 100-acre downtown technology zone--Cyberstreet--and the larger, complex technology infrastructure being built around it.

Last December, in a move that contributed to a growing trend nationwide, the Winchester City Council created a technology zone that offers exemption from land development fees as well as reduced business, professional and occupation license taxes to lure businesses.

In addition to Cyberstreet's lower taxes and other monetary benefits, Winchester's proximity to a nearby mushrooming technology area drew TeleGrafix Communications Inc. from Huntington Beach, California, to the historic Shenandoah Valley. "Northern Virginia is becoming the center of the Internet industry. It's got the second-highest concentration of tech companies in the world after the Silicon Valley,' says Pat Clawson, CEO of 4-year-old TeleGrafix Communications Inc., an Internet multimedia company.

Beyond being a city any techno-whiz could love, Winchester also offers amenities entrepreneurs need, says Barry Barovick, national director of corporate real estate consulting at Kenneth Leventhal Real Estate Group, Ernst & Young LLP, who advises clients on business relocation. "You're looking for a large labor force at a reasonable cost, plus a good quality of life to attract people. In addition, you need a good transportation network.'

Barovick says when considering relocating to one of the many high-tech zones emerging nationwide, you should investigate the business climate. Is there a public-private partnership between business and local, regional, and state governments? Is the state attitude toward business proactive?

Clawson also recommends investigating the financial climate of a city you're considering. "The biggest problem facing Cyberstreet is lack of commitment from the local financial community," stresses Clawson. "Tax breaks provide a good field to take root in, but you need capital for fertilizer."

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This article was originally published in the September 1997 print edition of Entrepreneur with the headline: Tech It To The Streets.

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