Unperturbed by the unruly general economic climate, which of course has also left is marks in Styria, Austria’s second-largest province continues down its chosen path to develop from a traditional industrial region into an internationally established technology stronghold. According to current numbers by Statistics Austria from December of 2009, Styria invested 4.31 percent of its gross regional product (GRP) in research and development in 2007. This is the highest value compared to all the other provinces. During the same period, the Austrian average allocation was 2.54 percent.

Networking as Recipe for Success

Creating networks and clusters is deemed essential in order to strengthen the status as a modern business location. In Styria, a veritable tradition of cluster building has emerged. This way of bundling economic versatility and top scientific performance is considered an advantage in the international competition of business locations. What began 15 years ago with the establishment of the ACstyria Autocluster as a pilot project, has now grown to a multi-faceted range of networks between global players that are represented in Styria and regionally active niche specialists, covering the various sectors and strengths of the Styrian economy. There are currently five clusters; the latest one is for the food production and technology sector. After a two year warm-up phase as a network, “Tech for Taste” officially formed a cluster last July.

Competence & Innovation

“Innovation is the natural enemy of the crisis,” Provincial Economic Councillor, Christian Buchmann is convinced and considers the competence centres to be innovation drivers for the Styrian economy. The competence centre programmes, started in 1998, are among the most successful initiatives of the Austrian technology policy. The COMET programme (Competence Centres for Excellent Technologies) is promoting the establishment of such centres, which are based on a research programme at the highest level, jointly defined by economy and science. The programme includes three lines of action: “K1 Centres”, “K2 Centres” and “K Projects”. They primarily differ in their requirements for subsidized organizations regarding internationality, project volume and duration. “In the global competition, it always is about being ahead of the pack regarding know-how. The cooperation of companies (also SMEs) with scientific institutions in the competence centres gives them that advantage,” says Buchmann. Two additional competence centres were approved before the turn of the year at a final hearing of the Austrian Research Promotion Agency (FFG). With them, Styria is now home to 23 of the 66 competence centres in Austria. Teamwork and networking is also considered a priority at the 30 Styrian Impulse Centres. This network of technology parks, start-up and innovation centres is supported by the Styrian Business Promotion Agency (SFG). Half of these centres are either owned by SFG’s subsidiary Innofinanz or operated as investment companies.

Energy and Environmental Technology

Energy and environmental technology is one of the strong suits of Styria as a business location. To strengthen and further expand this position, ECO World Styria supports businesses in the areas of innovation, know-how and international markets. ECO World Styria is one of the largest networks of energy and environmental technology businesses in Europe. At the last industry meeting, “ECO

Zukunftswerkstatt”, the numbers for the 2008 business year of the over 140 ECO companies were presented – and they were quite pleasant: 15 percent real growth to 2.7 billion EUR in revenue purely from environmental technologies, as well as an 18 percent increase in jobs in environmental technologies. The main drivers for growth were the solar sector with international contracts, as well as the field of hydro technologies. The export quota was also increased by two percentage points to reach 78.5 percent.

Materials Innovations & High-Tech

Throughout centuries, the Eastern Upper-Styrian region has developed into one of Europe’s most competent materials regions. AREA m styria GmbH, a network management consisting of six municipalities as well as the EU regional management, acts as a virtual impulse centre in order to strengthen and further expand the region’s core competences: technology and materials. The technological core competences at AREA m styria GmbH consist of its industry-related research and development activities as well as education programmes at the University of Leoben and non-university R&D institutions, such as the industry-related competence centres, Material Center Leoben and Polymer Center Leoben.

Cross-Border Cooperation

Joint interests also exist across provincial borders – as it happened in the “Impulse Region Fürstenfeld”, a cooperation of 14 municipalities that extends into the neighbouring province of Burgenland. All in all, 1.5 million square metres of commercial land are available and being marketed by “Impulse Region Fürstenfeld”. Global players such as corporate giants Magna and ACC as well as the successful Fürstenfeld-based company DCM have set up camp in the region.

Economic Area of Greater Graz

As the largest Styrian urban centre, the region of Graz is an important economic area in the south of Austria. Since it started operations seven years ago, Cargo Center Graz in the south of the city has developed into a major logistics centre for the South-Eastern European economic area. Today, it offers over 110,000 square metres of modern warehousing space; the daily volume of handled goods amounts to more than 3,500 tonnes. CCG Immobilien is commissioned with the commercialization of Cargo City Graz, a 15 hectare development area that directly adjoins the terminal of the Cargo Center. Half way between Graz and Maribor, situated directly beside the A9 motorway, Graz-based real estate developer WEGRAZ is transforming the former factory site of LG.Philips Displays Austria into the modern Tec Center Lebring (TCL). A perfect infrastructure, the Cargo Center Graz just a few minutes’ drive away, and a fast and flexible adaptation of the existing buildings for individual needs – besides the immediate proximity to the Eastern and South-Eastern European markets, these are some of the advantages of the location of TCL. At the moment, eleven companies have settled here; all in all, approximately 28,000 square metres of production, warehouse and office space are being offered on a total area of 127,000 square metres.

As the real estate organization for the City of Graz, GBG is not only active in the construction of communal buildings and the restructuring of municipal residential buildings and properties in the old town: To develop the city as a business location, GBG also actively pursues the settlement of businesses, as they had done during the development of the tradition-laden premises of the Puch production plant in Graz. For this purpose, the Innnovation Park Graz-Puchstraße (IPG) was founded – a Public Private Partnership between GBG and Immorent. IPG encompasses an area of 175,000 square metres and is located strategically and conveniently, only three kilometres from the city centre as well as the nearest motorway connector. The distance to the airport is seven kilometres. At present, approximately 70,000 square metres of utilizable space are available at Innovation Park Graz; in addition to the purchase of developed land parcels, there is the opportunity to rent existing office and commercial space. The International Business Centre (IBC) is also located at the doorsteps of Graz, near the hubs of the airport and the A2 and A9 motorways. Six office buildings with a total usable space of 25,000 square metres are available at the moment; another six blocks are planned to be developed on the premises.

Office Real Estate Market in Graz

GBG also has some office and commercial centres (BGZ - Büro- und Geschäftszentrum) in their project pipeline in Graz, such as the BGZ Thondorf, Liebenau and Puntigam. For the first time ever, a current study by the Austrian Association of Real Estate Trustees documents the office market situation in the region of Graz, which is Austria’s second-largest office location with approximately 1.8 million square metres of office space. Graz is a conservative office market; the development of office properties depends largely on demand. As a general rule, construction only starts once an adequate pre-finish occupancy rate has been achieved. For new office properties completed by December of 2009, the occupancy rate is at approximately 86 percent. The 82 percent pre-finish occupancy rate for the 61,000 square metres of office space that are currently under construction and will come on the market during the course of this year or next year is almost just as high. The vacancy rate is approximately 5.8 percent, with older properties responsible for the majority. The inner city area and the region surrounding the southern access roads, which has gained significantly in attractiveness as a business location, are the preferred development areas for new properties. [ IN ]