Andrew Florance, chief executive of CoStar Group, looked at 10 areas when considering where to open a research hub. He chose Richmond, Va. (Photo by Jeffrey MacMillan for the Washington Post)

Andrew Florance hires hundreds of recent college grads for research and tech jobs for his  real estate data firm CoStar Group. When considering where to open a new 700-person research hub recently he made top-notch local colleges a priority.

But Florance — whose company owns — is also acutely aware of how difficult it is now for his employees, some of them making $45,000 or $50,000 a year, to afford to live in cities like his hometown, Washington, D.C.

“In Washington, D.C. I would expect to pay $2,000 or more for a one-bedroom anywhere close to work,” Florance said. “In Kansas City I would expect to spend $700 or $800 for a one-bedroom, so less than half. If your rent for a small, one-bedroom is $2,400 a month, that’s eaten up more than half of your income right away. You have to have a roommate in the one-bedroom or you have to commute two hours.”

As other employers have discovered, many younger workers are choosing jobs that don’t require driving — even if it means turning down more money or a promotion. D.C. wasn’t the answer.

So Florance surveyed markets from the East Coast to the Rocky Mountains and looked at 10 states closely before narrowing his search to three places with far lower costs of living: North Carolina, Kansas City and Richmond, Va.

On Monday, Florance announced he’d chosen Richmond, where he will begin relocating employees next month. He said North Carolina’s anti-transgender “bathroom” bill was “more controversy than we want to engage in right now” and said proximity to Washington gave Virginia’s capital an edge over Kansas City.

(The deal also provided Florance’s company, CoStar Group, $8 million in state and local incentives.)

He predicted that housing costs in Washington, New York, San Francisco and other gateway cities will begin pushing more companies to do the same and consider smaller cities. In Washington, he said he expects the problem to continue worsening because only 0.6 housing units are being added for every new household — something the mayor is trying desperately to combat.

“I think cities with super-high housing costs are going to see companies looking around at secondary and tertiary cities until something happens with those costs,” Florance said.

In-depth: The rent is too high in big cities. This mayor has a plan to fix it.

Follow Jonathan O’Connell on Twitter: @oconnellpostbiz