Critical Components

Can the role of science and technology parks as engines of economic prosperity be overstated?

Perhaps, but it’s hard to do so in the current economy. For every large new project — like Samsung’s recently announced, US$3.6-billion chip plant expansion in Austin, Texas, adding 500 jobs — hundreds of new startups take wing every year that when mature will employ many times that. For years, areas and savvy universities have understood the importance of providing the nests from which the fledglings would emerge. But today, an area’s failure to provide the latest in research and commercialization tools puts that area at a distinct disadvantage. It might as well tell Samsung to expand a facility in some other location.

Areas that operate successful science parks know well their economic impact. “The University of Arizona Science and Technology Park is a critical component of the Southern Arizona high technology economy, contributing $3 billion annually,” says Bruce Wright, associate vice president of university research parks for the University of Arizona. “The UA Tech Park is also a major regional employment center with approximately 7,000 employees. On average, it has added 250 new jobs every year over the past 11 years,” he notes. “Beyond the measurable economic impacts, the UA Tech Park works as a center for innovation and technology commercialization, work force development and community engagement. The park’s next big idea is to develop a comprehensive solar business zone to capture the economic upside of the growing solar industry. The Solar Zone @ the UA Tech Park will integrate the generation, manufacturing, work force training, research & development and public awareness of renewable-energy into one central place.”

Sounds promising, and very much in line with the push to renewable energy development and production. But science parks’ role in economic development is still being defined — is it local or regional or statewide or all of these — as new technologies and their potential to generate jobs come into focus.

Innovation Infrastructure

“On his 1927 tour to celebrate his solo flight across the Atlantic, Charles Lindbergh wouldn’t fly to Vancouver, because the airport was too small,” noted Brian Darmody, president of the Association of University Research Parks (AURP) and associate vice president for research and economic development at the University of Maryland, in December 2009 testimony to the U.S. Senate Committee on Commerce, Science and Transportation. AURP had recently held its annual conference in Vancouver. “The Vancouver government immediately bought land and built a larger airport for the fledgling air industry, which today serves as a major hub for international trade to the Pacific Rim and major jobs generator for British Columbia. We view research parks as part of a nation’s 21st century innovation infrastructure,” Darmody added, “just as airports and railroads did in earlier centuries, and high bandwidth Internet backbone serves today. Innovation is key to job creation, and support for innovation an important federal mission.” Darmody was testifying in support of Senate Bill 583, which provides federal funding for research parks via the U.S. Economic Development Administration.

“The Obama administration and Congress and others are all looking at ways to improve innovation, improve the economy and create jobs,” Darmody told Site Selection in mid June. “Research parks are a necessary, but maybe not sufficient condition. They are important pieces of the innovation puzzle, because you want a place for smart people to locate and where ideas can incubate and partnerships can grow. They are anchors in localizing innovation. They are where startups can grow and where larger corporations can have operations and perhaps cluster,” he adds, pointing to Clemson University International Center for Automotive Research (CU-ICAR) as a classic example (see the South Carolina spotlight, May 2010).

Parks in Transition

And they are evolving, says Darmody, so potential investors might watch for these emerging trends as they seek to maximize their science and research park experience: “Parks are becoming much more mixed use, with housing for example — live where you research. Much more important than LEED certification, in my view, is having housing near where the researchers research, which reduces the carbon footprint immensely, more so than the building itself.” Similarly, look for more parks to be developed in infill areas rather than on greenfield sites, he adds.

Another development is universities moving certain degree programs to research parks, which multiplies opportunities for innovation and synergy among the park population. The University of Maryland – College Park business school has recently opened an MBA program at the University of Maryland, Baltimore, BioPark, for example. “I believe that’s the first time a different school put a degree-granting program in a research park that was not their own. It will help train doctors to become entrepreneurs and the next generation of bio-executives.”

Finally, says Darmody, “We’ll eventually see the research park come to the campus, where you’ll have privately financed buildings on traditional campus land, wherein translational research might take place. One example might be an incubator for larger companies, not just startups.”

Incubators can be found in city-developed technology centers, as well, especially in cities whose leadership understands the importance of cultivating startups today in the industries that will define the business landscape of tomorrow. Cities with in-town medical schools and hospitals are helping grow medical research parks, as in Shreveport, La. (see the Louisiana spotlight, this issue) and Memphis, Tenn. (see sidebar), among many other locations.

Dayton Redux

Such facilities are not required for science and technology parks to succeed as urban economic engines. But a vision for (a) linking research initiatives and entrepreneurship in related scientific fields and (b) creating space for those linkages to bear fruit is required.

Consider Dayton, Ohio‘s 40-acre (16-hectare) Tech Town development taking shape on a former GM manufacturing site. The development is instrumental in transforming Dayton‘s economy into a center of aerospace, remote sensing and advanced materials expertise. Besides incubator space for RFID (radio-frequency identification) and advanced sensor technology enterprises, Tech Town provides access to seven regional research institutes, including the U.S. Air Force Research Laboratory (AFRL) at nearby Wright-Patterson AFB and the University of Dayton Research Institute and its approximately 700 full-time researchers.

“The site was a portrait of the Rust Belt,” prior to redevelopment, says Steve Nutt, senior vice president, CityWide Development Corp., which manages Dayton’s long-term economic development strategy. Today, in addition to Tech Town‘s research campus, the area features loft housing, a public market, a baseball stadium for the Dayton Dragons, RiverScape Park and other amenities. The Oregon District entertainment community is just a few blocks away.

The original Tech Town facility is a 35,000-sq.-ft. (3,250-sq.-m.) incubator that Nutt says houses 15 to 20 startup technology companies at any given time. A comparably sized building erected in 2009 houses IDCAST — the Institute for the Development and Commercialization of Advanced Sensor Technology, a collaboration of AFRL, the University of Dayton Research Institute, approximately 30 companies — ranging from Boeing and General Dynamics to two-person operations and startups — and eight universities. IDCAST’s mission is to commercialize sensor technologies originating from these research sources.

About $20 million of the original $28 million in funding for IDCAST went to state-of-the-art sensing technology and 50,000 sq. ft. (4,650 sq. m.) of lab space for research in lasers, electronics, visualization and human signature sciences, among other areas. Much of the rest of the funding — about three quarters of it — was earmarked as one-to-one matching funds for companies and academics who would submit proposals to IDCAST explaining how their sensor technology would create jobs in Ohio.

“We have awarded $6.2 million,” says IDCAST Director Larrell Walters, “and rather than a one to one match, we’ve received about a one and a half to one match — it’s turned into a $15 million investment for Ohio, and it will have a significant impact on jobs.” Walters says the center has launched five startups, is incubating six and has created 259 jobs in three years 43 in academia and the rest in industry.

Ready for Your Closeup?

“These are pretty cool technologies,” notes Walters. IDCAST put $1 million into one company (which more than matched that investment) that makes next-generation, 3-D movie cameras. “Regular, DVD-quality movie cameras are 320,000 pixels. This one is 4 million pixels a frame, and it records the angle of inclination of each pixel. So you’re capturing real-time 3-D movies. The pixels are so close together, we can read the indents on your fingerprints from six feet away in 3-D.” The technology can be used to track micro-muscle facial movements (indicating one of seven emotional expressions shared by all of mankind) for signs of anger or anxiety, for example, which would have very useful applications in national security arenas. Speaking of which, another of IDCAST’s specialties is CBRNE sensing, short for chemical, biological, radiological, nuclear and explosives sensing.

Meanwhile, RFID technology is replacing the ubiquitous barcode, which was first implemented in the Dayton area. As of 2009, Tech Town operates the world’s first RFID Convergence Center, an incubator focused exclusively on RFID research and development. “The model is a little different than a traditional incubator, which provides space and access to shared resources,” says Nutt. “The managers of this incubator had established strong ties with industry drivers — such companies as Procter & Gamble, Cardinal Health and Lexmark. If you’re a smaller player in RFID, you want access to those kinds of companies and access to the AFRL. This center provided that out of the gate, making it very attractive to companies.”

Of about 30 companies applying for use of the RFID Convergence Center, only eight were accepted as tenants upon opening. The center’s model resembles a venture capital play in that the incubator has a small financial interest in the companies that locate there. Twelve companies are resident in the incubator now, and several of those are on the verge of securing long-term contracts with major companies, says Nutt.

“We’re starting to do what we’ve wanted to do, which is to grow our own companies,” says Nutt. “It’s hard to attract people to Dayton or the Midwest for quality of life reasons, because lots of places can say the same thing. We needed to determine where we could compete and be better than anyone else, and what would give people a reason to feel compelled to be in Dayton.”

Clusters by Design

Adds Bradley Proctor, executive director and CEO of the Dayton RFID Convergence Center, “We see Tech Town attracting not only companies directly to the 15-building campus environment, but we also see companies locating outside of the physical boundaries of the campus with the intent of capitalizing on the rich environment of sensors, aviation and R&D facilities that will be on the campus. Their purpose is to be close to where the innovation occurs so that companies can get access to technologies and a trained work force to help develop their technologies — the ‘beltway bandits’ theory of economic development.

“The automotive industry developed a cluster of technology in Dayton and thereby played a significant role in the prosperity of Dayton for the last hundred years,” adds Proctor. “And that cluster developed by accident. Today’s clusters of sensors, UAVs and aerospace are being developed not by accident but by design. Tech Town will serve as a hub for these clusters in Dayton.”

“A lot of people underestimate what Dayton has to offer,” says Walters. “We were so creative at the beginning of the century, with the Ketterings and Wright Brothers and so forth, and automotive was so big. But we got out of that mode of continual innovation we were in at that time. That innovation fed the regional economy for 100 years. Now, with automotive taking a dive — it’s gone now — we’ve got to get back to what that legacy was all about, which is creative thought. We have to win the game that’s based on innovation.”