Northrop Grumman Adds to Growing Cybersecurity Hub in San Antonio

San Antonio—Northrop Grumman, the military contractor that makes everything from cybersecurity systems to fighter planes, has signed a five-year lease on a new property at Port San Antonio, where officials are trying to entice more cybersecurity businesses to move.

Northrop (NYSE: NOC) is going to occupy a 7,700 square-foot building at the Port, which was established as a public entity to attract new businesses and jobs to San Antonio by redeveloping an old 1,900-acre Air Force base. Falls Church, VA-based Northrop won a contract last week from the Air Force to develop an operations system for the Air Force’s cybersecurity tools and weapons. The 24th Air Force, a division of the U.S. Cyber Command that directs the cybersecurity for the Air Force, also leases space from the Port.

The new lease will mean an expansion for Northrop in San Antonio, where it currently has 35 employees. The company declined to say how many more employees it plans to hire. Its Air Force contract is worth $9.4 million for the first year, and could be worth up to $37 million if it extends to three years, Northrop said in a news release.

“The San Antonio region offers an exceptional talent pool, proximity to our customer, and opportunities to expand partnerships with local small business,” Bobby Lentz, a vice president at Northrop, said in a news release.

Plenty of other large government contractors have a presence and are expanding in San Antonio, including Lockheed Martin (NYSE: LMT), General Dynamics (NYSE: GD), and locally based IPSecure, but the area only has a few startups with operations related to cybersecurity, such as Infocyte, Jungle Disk, and others with a relationship to cloud computing giant Rackspace.

San Antonio city officials have been trying to change that, with a goal of adding more young, innovative businesses to the region to expand its reputation in cybersecurity beyond traditional government contractors. Local government groups, nonprofits, and private donors helped launch the Build Sec Foundry startup incubator last year to help entrepreneurs start cybersecurity companies. It has worked with three so far: Infocyte, Privasera, and Level Effect.

Port San Antonio is building a 90,000 square-foot building that will be open to cybersecurity and other technology companies as a part of the effort to attract more entrepreneurs and large businesses like Northrop. The 24th Air Force itself is simultaneously working to develop a so-called “Cyber Proving Ground”—unclassified demo space where big and small companies can show off their products to the Air Force.

Meanwhile, other groups like the San Antonio Museum of Science and Technology are opening up at the Port with a related goal of getting young people interested in technology, hoping that will help them possibly some day enter the tech workforce.

David Holley is Xconomy's national correspondent based in Austin, TX. You can reach him at [email protected] Follow @xconholley

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