University Research Park Feasibility Study
and Business Plan Development
Presentation to CSSC Consortium Meeting
Battelle Technology Partnership Practice
June 20, 2013
BUSINESS SENSITIVE
1
Project Purpose and Methodology
• Purpose: Comprehensive assessment and development
approach for advancing a University Research Park
initiative based on the needs/opportunities at APG and
across industry drivers in the region and how they can
best connect with universities.
2
University Research Parks Are MultiDimensional Drivers for Economic Development
• University Research Parks are place-based initiatives that promote
physical, talent, technology and industry development and broader
industry partnerships with universities and research drivers
Universities, federal
labs, non-profit
R&D institutions
•
•
•
•
Research partners
Flow of talent
Exchange of ideas
Access to labs and
specialized equipment
Private
Companies
Research Parks
Communities generating
innovation, technology and
knowledge
Growth of existing
Commercialization of
companies
Intellectual Property
Creation of new
companies
Generation of Jobs and Income
3
Today’s Agenda
• Overview of Key Findings and Potential
Opportunities for URP
• Discussion of Potential Demand Drivers/
Opportunities for URP
• Discussion of Implications for Program Activities,
Governance, Operations and Funding Approaches
• Next Steps
4
Key Findings Point to Three Key
Opportunities for Advancing the University
Research Park Initiative
Growing
Regional
Technology
Industry Base
Advancing
Workforce
Development
Fostering
High Value
Place
Strategy
5
Overview of Key Findings and Potential
Opportunities Identified
• Potential Opportunity: Growing the Technology
Industry Base in APG Region
Key Factor
Strengths
Technology Major gains in tech industry
for APG Region
Industry
Innovation
Increased presence of C4ISR
related defense contractors
Many inventors living in APG
Region
Significant base of SBIR and
patent activity associated with
APG tenant organizations
Weaknesses
Tech industry growth stalled in APG
Region after 2007
Few companies in APG Region assigned
patents, few winning SBIR awards for
APG tenant organizations and few
venture-backed
6
Significant Rise of APG Tech Industry has
Stalled Since 2007
APG Region tech industry grew
from 6,768 jobs in 2001 to 8,587
jobs in 2011, growth of 27%, well
outpacing Baltimore region and
U.S. nationally
2001-2011 Percentage Increase in Technology Industry for APG
Region, Baltimore Region and U.S.
• The APG region tech industry
employment peaked at 10,446 jobs in
2007 and has declined since to its
current level of 8,587 jobs in 2011, a
decline of 1,859 jobs or 18% from 2007
Trends in Technology Industry Employment – APG Region, Baltimore MSA and U.S.
(Indexed 2001 = 100)
Source: Battelle analysis of Bureau of Labor Statistics (BLS), QCEW data; enhanced file from IMPLAN.
7
Wide Divergence in APG Region’s Tech Industry
Growth Rates Relative to the U.S.; Several
Highly Specialized Sectors in the Region
APG Region Technology Industries: Employment Size, Relative
Growth, & Relative Concentration, 2011 & Trends 2007-11
Quadrant 2
Transitional
8.00
Note growth
rates relative to
the US :
Quadrant 1
Stars
Space Vehicle Propulsion
& Parts
7.00
Actual LQ = 129
- Wired
Telecomm
actually a
negative 7% but
US had larger
negative
6.00
Biotech R&D
Location Quotient, 2011
- Computer
Programming
slight positive
growth rate but
lagging strong
growth in US;
Analytical Lab
Instruments
5.00
Actual LQ = 14
4.00
Environmental
Consulting Svcs
Other Physical
& Biological R&D
Engineering
Services
3.00
2.00
Computer Systems
Design Svcs
Custom Computer
Programming
-100%
-75%
-50%
1.00
-25%
0%
50%
75%
100%
Wired Telecomm Carriers
Management Consulting
Quadrant 3
Divergent
25%
-
Employment Change Relative to U.S. (2007-11)
Source: Battelle analysis of Bureau of Labor Statistics (BLS), QCEW data; enhanced file from IMPLAN.
Quadrant 4
Emerging Potential
8
Overview of Key Findings and Potential
Opportunities Identified
• Potential Opportunity: Addressing Workforce
Issues
Key Factor
Strengths
Talent
Strong demand for high skilled
workforce across range of skills to
support broad missions – C4ISR,
Chem/Bio, Business/ Financial
High educated/skilled residents in
region (42% AA degree or higher)
Significant top talent generation of
new university graduates just outside
of APG Region
STEM activities in region growing
new pipeline initiatives – TowsonHCC new 2+2 facility; UDel-HCCCecil-DTCC Regional Cybersecurity
Education Alliance
Weaknesses
Many of the high educated/skilled
residents commute
Many of the newer and mid-tosmall tech companies finding it
hard to fill high skilled jobs and
not connected to top talent being
generated
Hard for universities to aggregate
demand and serve needs of APG
organizations and contractors
9
Demand for High Skilled Talent in Region
Mounting
• Beacon Associates 2009 assessment of forecasted
demand across APG organizations over time –
Range of Annual Demand: 2010-19
Key Degrees
• Associate Degree: 35-58 per year
• Bachelor’s Degree: 127-200 per year
• Master’s Degree: 99-217 per year
• PhD Degree: 16-18 per year
Engineering
Logistics
Business Administration
Supply Chain Management
• Note: Beacon study did not examine demand for IT skills
• Susquehanna WIA Occupational Projections for 2008-2018
-
Engineers – 115 average job openings per year
Technicians – 37 average job openings per year
Computer & Math – 101 average job openings per year
Business & Financial – 237 average job openings per year
- Note: At least half the demand for each occupational group due to need for
replacement workers, not just new jobs
10
Technology Focus Areas Identified at APG
Sensors, Electronics and
Communications
Information Technology and
Software Development
Materials Research
Pathogen Detection and
Countermeasures
Testing & Evaluation
Significant Talent Pool Among Residents
and Near-by Universities
Number of
Degrees,
2010
Universities in Broad Aberdeen Region
1434
2569
790
1387
3284
Maryland Universities in Broad Aberdeen Region
783
1523
297
662
1603
Share of
U.S.
Degrees,
2010
Universities in Broad Aberdeen Region
4.2%
4.3%
13.7%
6.2%
3.8%
Maryland Universities in Broad Aberdeen Region
2.3%
2.6%
5.2%
3.0%
1.9%
• Universities within 90 minute
commute of APG offer a substantial
base of university graduates just
outside of the APG Region
Source: National Center for Educational Statistics
11
Highly Educated and Skilled Resident
Workforce – But Many Still Commute Outside
of Region for Work
• Significant numbers of
• High Educated and Skilled
residents commute out of
Resident Workforce
region for work
– 42% of APG Region
residents have a
postsecondary degree
– 25% of APG Region
residents work in
occupations dealing with
management, business and
financial occupations (17%)
or computer, engineering
and scientific occupations
(8%)
Work in
Region
College Educated
Work Outside
of Region
40,257
34,181
AA Degree
9,750
6,672
BS Degree
18,337
19,803
Grad/Prof Degree
12,170
7,706
23,327
20,666
Mgt, Bus, Financial
15,298
14,828
Computer, Eng &
Science
8,029
5,838
Selected High
Skilled
Occupations
Source: Census America Community Survey Public Use Microdata Sample
Note: Includes Cecil, Harford and Kent Counties
12
Overview of Key Findings and Potential
Opportunities Identified
• Potential Opportunity: Creating a World Class
Technology District
Key Factor
Strengths
Weaknesses
Place
Established significant
Class A Office & Flex
Market around APG
Class A Office and Flex Market is scattered
across Routes 40 and 22 – lacks sense of
place
Planned redevelopment
efforts for mixed use,
transit-oriented
development around
MARC stations in region
High vacancy rates found in Class A and Flex
Limited mixed use development
13
Rise of Defense-related Tech Based
Industry Base in APG Region Shaping
Commercial Real Estate Market
Location of Defense-related Tech Industry Employment by Type of Facility
Defense-Related Tech
Industries Mapped
– Engineering
Services
– Commercial
Scientific R&D
Services
– Space Vehicle
Propulsion
– Computer System
Design
– Customized
Programming
Services
– Testing
Laboratories
– Analytical Lab
Instrument Mfg
Source: Hoover’s Company Data Matched to CoStar Facilities; Calculations by Battelle
14
Post BRAC 2005 – A Class A Office Market
Established in APG Region; Relatively
Modest Growth in Flex Space
Timeline of Cumulative Inventory of Available
Space --Total Rentable Building Area (RBA) in
the APG Region
Year
Class A Office Space,
RBA Sq. Feet
Flex Space,
RBA Sq. Feet
2005
161,000
2,676,199
2006
201,000
2,706,531
2007
301,000
2,867,023
2008
386,000
2,958,523
2009
419,446
2,982,523
2010
731,334
3,033,643
2011
1,134,453
3,033,643
2012
1,425,153
3,033,643
Note: Data represent total inventory of existing rentable square feet as of the end of each year.
Source: Battelle analysis of CoStar Property database for APG region (Harford and Cecil Counties).
15
But Development is Scattered Largely
Around APG – Otherwise Would Be a
Signature Technology Park
Location of Office and Flex Space Office Parks By Type of Facility
APG Region
Closer Look In Immediate
Area of APG
Source: Hoover’s Company Data Matched to CoStar Facilities; Calculations by Battelle
16
Commercial Real Estate Market is Weak in
Region
Year End 2012 Levels of Vacancy and Leasing Rates for APG Region and Baltimore MSA
for Class A Office and Flex Building Markets
APG Region
Market
#
Blgs
Total
Rentable
Space
2012 Net
Absorption
Baltimore MSA
Vacancy
Rate
Leasing
Rates
Vacancy
Rate
Leasing
Rates
Class A
Office
17
1.43 MSF
72,540
41%
$31.02*
15%
$24.53
Flex
Buildings
149
3.03 MSF
(-44,118)
21%
$16.84*
11%
$11.26
* Leasing Rates reflect selected areas of Harford and Cecil County designated as industrial .
Source: Battelle analysis of CoStar Property database for APG region (Harford and Cecil Counties).
• If APG Region had a 15% vacancy rate in Class A Office and Flex
Space Markets would result in an additional 559,259 net sq ft
occupied and an additional 2,796 jobs gained
• In light of high vacancy levels, the leasing rates remain high for
Class A Office and Flex Space around APG
17
Program Activities Suggested for the Three
Potential Opportunities to Advance the
University Research Park Initiative
Growing
Regional
Technology
Industry Base
Advancing
Workforce
Development
Fostering
High Value
Place
Strategy
18
Growing the Regional Technology Industry Base:
Furthering Pro-Active Outreach Marketing
Increasing Presence
of Contractors
Working on C4ISR
Target SBIR recipients
from APG
organizations
• Nearly 400 SBIRs awarded by
APG organizations from 20102012. Few to APG companies
or even Maryland companies
• Battelle outreach identified
interest to have presence at
APG to enhance client
relationship and access
• Key issues for these
companies were:
– Flexible leasing terms
short term stays
– Favorable rental cost
– Some interest in access to
classified space
• Key advantage of linking SBIR
companies to APG prototyping
facilities – Meet milspecs and
protect IP
•
•
•
•
Growing Chem/Bio
Industry Presence
• With presence of
USAMRICD opportunity to
Many defense-related
attract more Nuclear,
contractors continue to
Biological and Chemical
operate both in APG Region
Industry Group members
and Monmouth County
located in Northern Virginia
In 2011, the Monmouth
to APG Region
Region defense-related tech
industry employment stood at
14,870 … this is down from
its 2001 level of 17,957
Still, it is still much higher
than the 5,795 found in APG
Region in 2011.
Examples of firms in both
regions: Booz Allen Hamilton,
CSC, DSCI/D&S
Consultants, Engineering
Solutions and Products,
General Dynamics,
Lockheed, Millennium
Services, Northrop
Grumman, SAIC
19
Growing the Regional Technology Industry Base:
Fostering Technology Commercialization and StartUp Venture Activities
• Build upon base of
• Address weak
inventors living in APG
presence of
emerging, innovative Region driving patents
companies in APG
• 1,328 patent applications
Region, with a few
and awards from 2001notable exceptions
2012 -- but few assigned
to companies in APG –
of homegrown, highlargest holders of
growth tech
patents from inventors
companies
• Four venture capital
backed companies
since 2003 in
ThomsonOne
Venture database
• Four SBIR funded
companies across all
federal agencies from
2008-2012
•
living in region are Black
& Decker, Army, DuPont,
Applied Nanostructured
Solutions, Gore, JHU,
UMBC
214 patent applications
and awards assigned to
individuals living in APG
Region and 44 assigned
to universities
Need more pro-active effort
to incentivize
commercialization in APG
Region
• Develop a network of
advisors resident in APG
Region with technology,
market and business
expertise -- similar to what
Innovation Center for the
Rockies has done
• Offer fund for assessment
and validation -- similar to
Central New York Grants for
Growth – unique feature might
be to link with rapid prototyping
found at APG or existing tech
industry capabilities found in
region
• Create Entrepreneurs in
Residence similar to Pittsburgh
to help in guiding effort
20
Advancing Talent & Workforce Development:
Clearinghouse for APG Related Education and Training Needs
• New initiative by APG to create
an educational partnership with
the APG Region to establish a
clearinghouse function for
education and training to better
match needs/requirements of
APG with educational providers
– Would address the mushrooming of adhoc relationships and lack of
coordination in education and training
found at APG
– Would offer APG organizations a
dedicated resource to help them better
aggregate needs and identify potential
education partners
– Offer educational partners easy point of
access and better awareness of
requirements
• Still unfolding … but holds great
promise beyond its specific
function for APG
– Potential opportunity to deepen
partnerships with universities to
offer defined programs to APG
– Create a broader initiative to
more fully engage contractor
community and serve their
individual and broader
community needs for talent
development
21
Advancing Talent & Workforce Development:
Talent Connector for Students and Residents
• Objective of talent connector would be to ensure that APG Region is
recognized as a talent rich community
– Tap into skilled,
experienced resident
workforce who commute
– Tap into growing STEM
pipeline within region (TU
2+2 and UDel Regional
Cybersecurity Education
Alliance)
– Tap large base of
undergraduate and
graduate students from
nearby universities
• For tapping resident workforce
that commutes:
– Identify potential local resident job
candidates
– Raise awareness and approaches
to gaining security clearances
– Target education and training to
close any gaps on specific software
applications or knowledge of federal
contracting, etc
• For STEM pipeline and broader
access to large base of
university students nearby APG
Region better connect through
internships, connect firms to
student projects, tie-in with univ
career services, etc.
22
Advancing Talent & Workforce Development:
Cybersecurity Education & Applied Research Institute
• Opportunity for Advancing Cybersecurity:
– Need at APG for advanced skill development and more hands-on, experiential
learning for cybersecurity developers, analysts and operators
– Opportunity for advancing collaborations with universities, such as in applied
research and development
- Includes system of systems engineering design, analysis, testing and experimentation
as well as modeling of cyber-agent behaviors
• Focus on:
– Raising competencies of existing 100-200 APG cybersecurity workforce
found across CECOM, CERDEC, ARL (SLAD, CISD), ATEC … often formal
training as EE and have learned cyberskills along the way
– Building pipeline for new workforce with defined programs with nearby
universities … opportunity to link with the University of Delaware-led Regional
Cybersecurity Education Alliance and other universities
– Broader contractor needs
• Still seeking to address:
– How to build upon proposed APG Education Partnership for Clearinghouse to
better aggregate demand for specific curriculum, certifications or degree
programs.
– Is there a value proposition to APG in having more proximity in accessing
education and training services or a more applied technology center?
23
Advancing Talent & Workforce Development:
Chem/Bio University Collaborations
• Value for Advancing Chem/Bio University Collaborations:
– Need at APG for advancing partnerships around systems biology,
growing focus on countermeasures and other emerging technology
areas
– Growing next generation of DoD scientists – creating relationships and
engaging top PhD and postdocs in specialized area of chem/bio
– Shared research & development opportunities for addressing
countermeasures, improved diagnostics and engineering devices (hard
wall on actual work with pathogens)
• Focus on:
– Raise collaboration opportunities with military (USUHS) and civilian
universities – seek collaborations to generate R&D funding … look to
Broad Agency Announcements of DHS or DARPA and then team with
universities or industry
– Possible reuse of USAMRICD wet lab facility that is being replaced –
may need some upgrading – place to house collaborations
– Collaboration opportunity on a new high-throughput ADME* facility to test
use of novel compounds
24
Foster High Value Place Strategy Locations:
Promote Mixed Use Redevelopment As Part of APG
Region Technology District
• Best practice in research • Opportunity for APG
Region is to move to
parks points to continued
create “Technology
focus on advancing “live,
District”
work, play” environments
o A far-reaching change in the
physical development of
university research parks
that began over last decade
– i.e. NC State Centennial Park,
UCSF Mission Bay, UCO
Fitzsimmons Life Science District
o Results of soon-to-bereleased 2012 updated
AURP benchmarking finds
the newer model is
continuing to emerge—
strategically planned,
mixed-use campus
expansions
o Housing – beyond for students
o Retail – more than just
restaurants
• Likely First
Mover
Opportunities:
Planned Mixed
Use TransitOriented
Development
o In sync with Master Plan
development
o Create identity – add
signage
o Aberdeen MARC
Station
o Advance broader range of
incentives for mixed use
o Perryville TOD/
development
Greenway Plan
o Target not only technology
businesses, but high
skilled administrative, back
office operations
leveraging residents who
commute
o Be able to market the
Technology District as a
“live-work-play”
environment
25
Summing Up Program Activities Across
Potential Opportunities for University
Research Park Initiative
Initiatives
Targeting emerging, innovative
companies serving APG
Advance Chem/Bio Industry
Presence at Edgewood Post
Initiatives
Growing
Regional
Technology
Industry Base
Support establishment
of Education
Partnership with APG
for Educ & Training
Clearinghouse
Create “talent
connector” for the APG
Region to broader
regional university talent
and to high skilled
residents who commute
Advance a
Cybersecurity Education
and Applied Research
Institute
Advancing
Workforce
Development
Fostering
High Value
Place
Strategy
Target technology
commercialization services to
“APG Regional Inventors”
Continue outreach to existing
C4ISR contractors to deepen
activities ongoing in APG Region
Initiatives
Establish APG
Technology District
promoting mixed use
development
Advance Chem/Bio
University
Collaborations
26
Organizing for Success
Potential Opportunities
Implementation Approaches
• Governance
• Operations
• Funding Approaches
Guiding Principles
• Form should follow
function
• Steering versus rowing
• Seek leverage and broader
public-private partnerships
• Best practices can inform
how to design
27
Battelle Ideas for Implementation to Grow
the Regional Technology Industry Base
Program
Activities
Targeted outreach
marketing to
companies doing
business with APG –
i.e. SBIR cos, C4ISR
cos, NBC Industry
Group
Commercialization
services to APG
Regional Inventors
Governance
Economic
Development
Advisory Board
URP Board to
oversee & advise on
activities, funding
Operations
Primary economic
development
function
Economic
development
function for staffing
to do outreach,
generate network,
solicit proposals,
create mentoring
Funding
Approaches
Best Practice
Examples
Existing economic
development
funding
Dayton Development
Corporation
Chamber of
Commerce of
Huntsville/Madison
County
Need an ongoing
source of public
funding – might be
able to structure
some returns
Seek support from
angel
investors/serial
entrepreneurs
Oklahoma’s Innovation
to Enterprise (I2E) –
OKC and Tulsa
primarily
CNY Grants for Growth
Innovation Center for
the Rockies
(previously just
Boulder County)
28
Battelle Ideas for Implementation to
Address Talent and Workforce Development
Program
Activities
Governance
Operations
Educational
Partnership
Clearinghouse
APG Organizations
University Center at
HEAT / NMHEAB
University Center at
HEAT
Talent Connector for
Students and
Residents
University Center at
HEAT / NMHEAB
Economic development
function given need
for close working
relationship with
County, Contractors
companies
(direct to students
and universities)
Possibly tap university
relationships of STEM
Pipeline and
Clearinghouse
Cybersecurity
Institute
URP Board in
conjunction with
APG Organizations
Chem/Bio University
Collaborations
URP Board in
conjunction with
APG Organizations
Identify university lead
with guidance of APG
Possibly house as part
of CERDEC technical
support lead
Identify a university
lead with guidance of
APG
Funding
Approaches
Best Practice
Examples
State, Local, APG,
Educational
Institutions (?)
Suburban MD
Technology Council
Oklahoma Project
Boomerang
Iowa Life Changing’s
smart career move
Aggregating APG
requirements
Air Force Institute of
Technology
Aggregating APG
requirements
29
Battelle Ideas for Implementation to Create
High Value Place-based Development
Program
Activities
Governance

Technology District
involving mixed

use development
Economic
Development
Advisory
Board
Collaboration
of County and
City – create
an overlay
district?
Operations
Funding
Approaches
Best Practice
Examples
Use of tax
mechanisms –
Tax Increment
Finance, PILOT
like in Prince
George’s County
Economic
development
function
Private developer Growth of mixed
investment
use approaches for
redevelopment
Consider
Business
Improvement
Districts –
Chapter 461 -- HB
1182 Laws of
2010
30
Broad Implications for Implementation
• Breadth of opportunities and related program activities
encompass large part of overall economic development
– Key elements include: physical development, business development,
innovation/commercialization and education & workforce development
• Implication #1  University Research Park Initiative will
require broad support as a top economic development
priority of APG Region to succeed
– For Harford County, this suggests it is governed overall by the
Economic Development Advisory Board
• Implication #2  Collaboration across county, city, state
government with APG will be critical
– Beyond collaborations between Harford and Cecil, even within
Counties will need collaboration on master planning
– Engage state authorized boards (NMHEAB) along with broader state
support for initiatives to promote technology industry growth around
APG
31
Thank You and Discussion
Initiatives
Targeting emerging, innovative
companies serving APG
Advance Chem/Bio Industry
Presence at Edgewood Post
Initiatives
Growing
Regional
Technology
Industry Base
Support establishment
of Education
Partnership with APG
for Educ & Training
Clearinghouse
Create “talent
connector” for the APG
Region to broader
regional university talent
and to high skilled
residents who commute
Advance a
Cybersecurity Education
and Applied Research
Institute
Advancing
Workforce
Development
Fostering
High Value
Place
Strategy
Target technology
commercialization services to
“APG Regional Inventors”
Continue outreach to existing
C4ISR contractors to deepen
activities ongoing in APG Region
Initiatives
Establish APG
Region Technology
District promoting
mixed use
development
Advance Chem/Bio
University
Collaborations
32