Triad hurting from lack of lab space
BYLINE: Matt Evans
Construction of a new "wet-lab hotel" should be getting under way in the Piedmont Triad Research Park soon. But demand for low-cost laboratory facilities for startups is already outstripping even that future supply, hampering efforts to build a pipeline of new high-tech companies for the region, according to some observers.
Paul Briggs, president of Wake Forest University's Babcock Demon Incubator, said he is seeing biotechnology entrepreneurs interested in locating in the Triad give up and look elsewhere because they can't find laboratory space available for short-term leases at rates affordable for a startup.
The wet-lab hotel is designed to provide such space and will have a prime location in the Research Park's new Biotechnology Research Facility 1 building, but there will only be three lab suites available and probably no earlier than this fall.
"It's a great start, but it's not enough," Briggs said. "If we're going to be a city of biotechnology or nanotechnology, we have to have labs. A town without labs can't call itself a biotech town."
The reason for the shortage of low-cost lab space is pretty simple to understand, according to Gwyn Riddick, director of the Triad office of the N.C. Biotechnology Center:
It's expensive to build, with all the necessary ventilation, plumbing and equipment, so lease rates that include a profit margin are usually necessarily out of a startup's reach. The wet-lab hotel in the research park is being planned and built with a lot of donated labor and equipment as a community project, which was the only way that project was going to happen at an affordable cost, he added.
"Even if you're just going into an empty building to upfit it, the cost per square foot is quite expensive," Riddick said. "It's not something you can do for just a few smaller tenants."
Bill Dean, the president of Idealliance, which is in charge of developing the research park, agreed that the planned space in the wet-lab hotel will not be enough to satisfy demand. With construction not yet even started, he said he already has as many as 10 viable companies interested in one of the three available labs.
The rules are still being worked out, but Dean said hotel tenants will be able to stay for at least a year -- long enough to establish themselves but hopefully short enough to keep a fresh supply of new companies coming in. Dean said he and park planners are looking for places to put more startup lab space, but they are also having to plan for mid-tier facilities.
"We're looking within the park for development opportunities in the competitive price range for not only new companies, but more mature ones," Dean said. "Once they grow out of the hotel, where do they go from there?"
An entrepreneur's dilemma
For biotech entrepreneurs like Tonia Crook, the biggest concern is still where to start. She lives in Lexington but is looking for space for her startup TUNTek, which is developing early detection and diagnostic tools for cancer and other diseases.
Crook is seeking her first round of funding now and wants to keep her company in the Triad, which she considers home. But investors are telling her that she needs to locate where there is infrastructure to support her, and they're steering her across the state to Research Triangle Park.
Crook dedicates a day each week to looking for lab space, but she's found nothing so far in the Triad that will work. She thinks she may have as long as six months to decide, but she's not too optimistic.
"I'm trying really hard to stay in the Triad but I can't put my company in jeopardy," Crook said. "When an investor signs on the dotted line, you have to be ready and know where you're going. If I had to do that tomorrow, I wouldn't be able to stay in Winston-Salem."
Briggs said he doesn't know a quick or easy solution to the lab space crunch, but he has begun making contacts with private companies in the area looking for some that might have excess lab capacity they would be willing to rent out. He's had conversations but received no commitments yet, he said.
Triadwide concern
Similar situations exists in Greensboro and High Point, and efforts are also underway there to address the issue.
In High Point, nanotech company QuarTek has started what it calls a "nano-accelerator," in which nanotech startups share its lab space and equipment in return for an ownership stake. There are at least seven firms in the accelerator or planning to join, QuarTek officials say.
In Greensboro, a recent partnership between the Nussbaum Center for Entrepreneurship business incubator and the Gateway University Research Park hopes to address the problem there. The two organizations recently agreed to make some of the laboratory space that will be developed at UNC-Greensboro and N.C. A&T's joint research facility available to incubator tenants.
Those kinds of creative arrangements will probably be the key to solving the space crunch in the long run, according to Riddick at the Biotech Center. He said the issue is a priority for a lot of individuals, organizations and universities in the region.
"When you put a lot of minds like that together on a problem, solutions will emerge," Riddick said.