October 3, 2007 edition

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The University Board of Trustees on Sept. 26 unanimously approved the plan for Carolina North to develop 250 acres of the nearly 1,000-acre site during the next half-century.

The trustees’ action clears the way for the plan to be reviewed and approved by the Chapel Hill Town Council.

The plan anticipates that 2.5 million square feet of building space will be completed over the first 15 years along the eastern boundary of the property bordering Martin Luther King Boulevard. The first of those projects will be a new 85,000-square-foot Innovation Center for which the University has already requested a special-use permit to begin construction.

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When visiting San Francisco, most tourists flock to see the Golden Gate Bridge, the internationally recognized symbol of the city, considered the engineering marvel of its age when the bridge opened in 1937.

Seventy years later, the San Francisco marvel that has caught the eye of Carolina’s Mark Crowell lies on the edge of the city in Mission Bay. Crowell is associate vice chancellor for economic development and technology transfer.

Once an industrial wasteland, Mission Bay is now home to a satellite campus for the University of California at San Francisco and, next to it, the burgeoning life science complex that is being developed by Alexandria Real Estate Equities of Pasadena, Calif.

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A philosopher who has interests in metaphysics and the mathematics of logic, a geneticist who is working to develop cancer therapies, a computer scientist who specializes in bioinformatics and data mining, and a historian who studies the African-American experience in the American South have received the 2007 Phillip and Ruth Hettleman Prizes for Artistic and Scholarly Achievement by Young Faculty.

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Seven Carolina employees were recognized for their outstanding contributions Sept. 24 at a luncheon at the Carolina Inn. Five people received the Chancellor’s Awards for Excellence and two received the Excellence in Management Awards.

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Campus-based tuition over the past decade has played a pivotal role in generating revenue to bolster faculty pay to keep Carolina competitive.

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Innovation Center designed to put Carolina North on the map

When visiting San Francisco, most tourists flock to see the Golden Gate Bridge, the internationally recognized symbol of the city, considered the engineering marvel of its age when the bridge opened in 1937.

Seventy years later, the San Francisco marvel that has caught the eye of Carolina’s Mark Crowell lies on the edge of the city in Mission Bay. Crowell is associate vice chancellor for economic development and technology transfer.

Once an industrial wasteland, Mission Bay is now home to a satellite campus for the University of California at San Francisco and, next to it, the burgeoning life science complex that is being developed by Alexandria Real Estate Equities of Pasadena, Calif.

Three of the seven buildings planned for the complex are completed including a five-story commercial building designed to cater to companies of all sizes. Its second floor is a “science hotel” built in configurable pods and designed for early-stage biotech companies with five or fewer employees. Tenants can add extra pods or office space as needed. The third and fourth floors are designed to accommodate slightly bigger companies, while the fifth floor has high-end office space leased to financial and venture capital institutions. The first floor features retail stores and a wellness center.

Over the past year, the University has worked closely with Alexandria to develop a model for the proposed Innovation Center at Carolina North — work that Chancellor James Moeser and other University leaders sought to advance by asking the Town of Chapel Hill last month for approval of a special-use permit separately from the future submission of the trustee-approved Carolina North plan.

As part of the proposed plan for Carolina’s Innovation Center, Alexandria would build the center and retain ownership and hold leasing rights for 40 years; then ownership of the building would revert to the University, Crowell said.  The University, in turn, would provide the site at Carolina North for the 85,000-square-foot building.

But Crowell emphasized that a partnership with Alexandria would signify more than a land deal, more than developing a building design or settling on a building location. This was about establishing and preserving a relationship with a unique partner that could do for Carolina North what has been done in San Francisco with Mission Bay, or in Manhattan with the East River Science Park or in Seattle with the Accelerator Corp.

“Alexandria has partnered in major projects from coast to coast and around the world in such places as Scotland and India and the ompany is now looking at China,” Crowell said. “They are continually working with academic institutions, governmental and non-governmental organizations, and major multi-national corporations in projects that involve the development of high-quality laboratory and business development space of the type that the Carolina Innovation Center will provide. By having Alexandria and Joel Marcus (its CEO) at the table with us, we become part of a global network of top programs and facilities operating in this kind of space.”

Having the Innovation Center and working with Alexandria to market it to potential tenants will put Carolina on the map in many new and exciting ways, Crowell said. “We will become a destination for research scientists and business development concerns around the world who will want to come see it and what’s happening within it. What a way to start Carolina North!”

For this reason, University officials are eager to move forward with plans for the new center.

Discussions with Alexandria began more than a year ago. Although Marcus has not said anything about walking away from the project, Crowell said, it is important to keep the momentum because Alexandria is in such high demand around the country.

“Alexandria is a blue-chip, crème de la crème partner, and we are trying to do everything we can to ensure we maintain steady and solid progress with this project,” Crowell said.

Not just another incubator
In the same way that the Golden Gate Bridge stretched the limits of engineering 70 years ago, the Innovation Center will move beyond the bounds of a traditional business incubator that offers start-up companies low-cost space, office support and mentoring.

In its Sept. 3 issue, Business Week highlighted a new “supercharged” model in “Now Hatching: A New Type of Incubator with Extra Oomph.” The article detailed how scientists and academics who have the technologies to start a new company often lack the business experience and access to capital to keep their businesses afloat.

This new model has been called an accelerator because venture capital firms back it. In the Business Week article, Dinah Adkins, president of the National Business Incubation Association, likened it to “an incubator on steroids.”

That story quoted Crowell talking about how the Innovation Center at Carolina North would use that kind of model. “What’s different is you have a focused management team and early investors with deep enough pockets to provide follow-on rounds of financing,” Crowell said.

The details of an accelerator were explained in a July 2007 paper, “Finding Business ‘Idols’: A New Model to Accelerate Start-Ups” sponsored by the Ewing Marion Kaufmann Foundation.

The authors compared the growth of new entrepreneurs who are changing the face of the venture capital industry to the way Simon Cowell revolutionized the music business with his “American Idol” television series.

Whereas “your father’s business incubator” was a real estate deal with start-ups as tenants who paid for shared overhead, an accelerator is a full partnership, the paper said.

“The accelerator typically provides much more space and common management services to start-ups,” the paper said. “It helps form companies as legal entities, interviews and hires the appropriate initial management team and lends its own management expertise. In short, the accelerator becomes the ‘new company’ through seed-stage development.”

How does a company join an accelerator? Just as contestants on American Idol audition their skills before a panel of judges, research scientists must compete for a limited number of slots on the accelerator’s team.

In addition, accelerators often concentrate on specific industries in order to assemble people with similar educational and business backgrounds to come up with cutting-edge commercial advances. The theory is that a group of potential entrepreneurial superstars will hatch more and better ideas than individuals in isolation will, the paper explained.

The first known accelerator was The Foundry Inc., which opened in 1998 in Menlo Park, Calif., with a focus on medical device development.

The company has raised more than $200 million to launch 10 medical device companies that were spun out of The Foundry’s in-house research team or technology from outside inventors that the team vetted. These 10 companies employ more than 350 people and have already generated more than $1 billion of value to their founders and investors, the Kaufmann paper reported.

Only a handful of other accelerators exist or are being developed, such as the Accelerator Corp. in Seattle specializing in biotechnology that Alexandria also developed. The paper also mentioned the new accelerator to be developed between UNC and Alexandria.

“Our impression is that the floodgate has opened and more accelerators will be created nationally and internationally,” the authors said.

The longer view
Over the years, Crowell, along with Tony Waldrop, vice chancellor for research and economic development, have emphasized that Carolina is one of the few public universities without a research park or incubator where University researchers could seek private grants with corporations to test discoveries that have commercial potential.

In the past, University officials have emphasized the lack of space as the major impediment for developing public-private partnerships. As a result, Carolina’s strong research enterprise has largely been driven by faculty member’s phenomenal success in securing federal grants from either the National Institutes of Health (NIH) or the National Science Foundation (NSF).

Now, Crowell believes the research funding from the NIH and NSF could also be at risk because of the growing push within these organizations to support researchers who can demonstrate their capacity to turn scientific discoveries into a marketable product.

That means the Innovation Center and the services it can provide will be important as a way for University researchers to maintain and build upon the current level of NIH and NSF funding — and to engage in new and expanded research funding partnerships with corporations and foundations also interested in investing research funds in universities able to translate research discoveries into products and services that help people, Crowell said.

Since he announced the goal of raising $1 billion in external research funds by 2015, Moeser has emphasized the vital role that Carolina North will play in that endeavor.

The process, Moeser told the Faculty Council last month, can and should begin now by moving ahead with the Innovation Center.

“I believe our faculty need this facility and they need it now,” Moeser said. “Many faculty working on start-up companies have had to find space outside the University.”

He also pointed out that because the center would be privately developed by Alexandria, it would benefit the town of Chapel Hill by generating property taxes.

Innovation Center

A GLEAM IN CAROLINA'S EYE University officials have begun laying the groundwork for the proposed Innovation Center to be developed at Carolina North. Because Carolina is one of the few public research universities without a research park or incubator where researchers could seek private partnerships to test discoveries that have commercial potential, Chancellor James Moeser believes the Innovation Center is crucial. For the past year, the University has worked closely with Alexandria Real Estate Equities of Pasadena, Calif., to develop a model for the center. Alexandria has created science and technology incubators around the world, from San Francisco and Seattle to Cambridge and Washington, D.C., in the United States and Scotland, Canada, China and India overseas.

 

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