Sunday, Aug. 16, 2009

Building Our City: Pivotal time for Innovista

USC leaders striving to put research campus on track to becoming economic engine that was originally envisioned

With the firing of its second developer, USC is starting over with one of the most visible and important facets of its Innovista research campus — two private research buildings intended to attract entrepreneurs.

USC president Harris Pastides calls this moment a “turning point” and says he is making “a fresh assessment” of how to advance the struggling campus.

But it remains to be seen if Pastides can deliver on the promise to the General Assembly and the taxpayers that USC can create private sector jobs. The two buildings— called Horizon II and Discovery II — are considered essential to reaching that goal.

There is some good news:

• Life is starting to trickle into two completed public research buildings — Horizon I and Discovery I.

• The internationally recognized Moore School of Business promises to boost Innovista when it moves there, perhaps in 1013.

• New vice presidents for research, advancement, and finance and planning will put fresh hands at the helm.

But the private jobs and private dollars supposed to spring from discoveries by USC researchers have yet come in any substantial numbers.

Ted Moore, USC’s new vice president for finance and planning, said Pastides and the rest of the administration remain committed to Innovista and optimistic about its future.

“The president’s vision and his support (for Innovista) is as strong as it ever could be,” he said.

Here are the issues facing what some are calling Innovista’s “reincarnation.”

DEVELOPER

USC fired its private development partner Kale Roscoe earlier this month.

Roscoe, a Detroit developer with a checkered financial past that includes felony tax evasion, failed to land financing for the Horizon II building, the first of the two private research buildings scheduled to be built, even nine months after his deadline to begin construction.

Now the administration plans to hire a new developer, perhaps one from closer to home, according to Pastides. And that developer probably will work closely with the university’s development foundation — a group that has a close, but arm’s length relationship with USC.

Names in the mix include Village at Sandhill developer Alan Kahn and Atlanta’s John Holder. But because of the Roscoe experience, USC might issue a request for qualifications rather than unilaterally picking a successor.

Holder could be considered a favorite. He partnered with the USC Development Foundation on the struggling Adesso condominium project on Blossom Street.

Despite Adesso’s slow sales (44 of 110 condos have been sold since January 2007, company management said), Holder, like Kahn, has a lot of “skin in the game” in Columbia, as developers say.

Holder built the Meridian office tower on Main Street and is building the Main & Gervais office tower at that prime intersection. Holder also is completing the Aspyre apartments on Assembly Street.

“We would certainly be interested in pursuing that work,” Holder said. “We like the people that are involved. We like the relationship we have with the university. And we would like to have the opportunity to do this if there is one available.”

The wild card in the formula is the economy.

Insiders say Roscoe would have been able to build Horizon II and possibly Discovery II — and populate them with tenants — if the economy hadn’t tanked just two months after he took over. Success on the street might or might not have overshadowed his earlier financial problems.

The economy will continue to be a huge factor in the rollout of a new plan for building the two private research buildings. So starting a little later, rather than sooner, might be a good thing.

TO BE RESOLVED:

Whom will USC choose to be the new developer? How will the USC Foundation be involved? What will the economy do?

TENANTS

In January, two Columbia-based companies — TM Floyd & Co. and VC3 — announced they would move most of their operations and about 120 employees into Horizon II.

They would partner with BlueCross BlueShield of South Carolina in a computer-training program to be based in the building.

Called the Consortium for Enterprise Systems Management, the program focuses on high-volume, mainframe computing technology.

The program is a partnership of 11 businesses, colleges and academic agencies headed by IBM and BlueCross BlueShield and aimed at training and placing new professionals in the field.

All three potential tenants say they have other options if Horizon II is not built or delayed further.

“The tenants have been very patient with us for months, and there have been discussions with them daily,” USC vice president Moore said.

As for the two public research buildings:

• The five-story Discovery I building on Greene Street near Colonial Life Arena has tenants on the second floor.

USC’s Cancer Prevention and Control Program has 27 employees — eight faculty/researchers and 19 staff. And the Department of Communication Sciences and Disorders of the Arnold School of Public Health has 11 faculty.

The first floor has a demonstration kitchen and a meeting room that are in use.

• The five-story Horizon I building at Blossom and Main streets will house researchers Brian Benicewicz and Ken Reifsnider. They will occupy about one floor each.

Upfitting — building offices and labs — is expected to be completed by the end of the year.

Benicewicz is the endowed chair of the Center for Polymer Nanocomposites and a professor in the department of chemistry and biochemistry. He will move his 13-member research group.

Reifsnider is director of USC’s Future Fuels initiative and the endowed chair of the Center for Solid Oxide Fuel Cell research, which comprises about 25 faculty, staff and students.

Reifsnider expects his group to grow by as much as 50 percent over the next year. He is the principal researcher for a $12.5 million grant from the U.S. Department of Energy that involves seven universities and two national labs.

Other plans for Horizon I include space for the nuclear engineering endowed chair.

• Also, the five-story Public Health Research Center in the Arnold School of Public Health is fully occupied by 152 faculty, staff and graduate assistants. It opened June 2006.

TO BE RESOLVED:

Will the prospective Horizon II tenants stay with the university or seek other options? And when can the university afford to upfit the rest of the public buildings for university tenants?

MOORE SCHOOL

Work on a new $90 million business school building could start as early as 2011. It would be located on Greene Street near the Colonial Life Arena and across the street from Discovery I.

The U.S. Department of Justice will expand its training operations at the National Advocacy Center on USC’s central campus and transfer an estimated 250 employees to Columbia over the next few years.

The Justice Department will pay the university an estimated $106 million over 20 years to lease the current Moore School building on Pendleton Street.

The plan will allow USC to build the new building and upgrade the old one.

When the Moore School moves into Innovista — perhaps in 2013 — the administration envisions that faculty members would work as consultants for companies that relocate or incubate there. Graduate students could provide research and data collection assistance. Each could receive some form of compensation for the work.

Benefactor Darla Moore also gave $70 million to the school — the largest private gift by a single donor to a U.S. business school.

The university last month announced it had raised $44.7 million as a match for Moore’s gift. Moore required $30 million.

Moore said the business school faculty and students had been underutilized in economic development and endorsed using them to help private companies.

Vice president Ted Moore (no relation) called the business school “a major anchor” for Innovista.

TO BE RESOLVED:

The design of the Moore School and how it will integrate with the rest of Innovista. Also, how will the faculty and students interact with private businesses and how will they be compensated?

ADMINISTRATION

The biggest question mark is whether Innovista director John Parks will keep his job after the most recent developer, Roscoe, was fired.

Parks recommended Roscoe because they had worked together at the University of Kentucky’s research campus.

It is still unclear whether Parks properly vetted Roscoe or properly informed Pastides and the USC Board of Trustees of Roscoe’s past financial troubles.

Vice president Moore wouldn’t comment on Parks, calling it “a personnel issue.”

Efforts to reach Parks were unsuccessful.

Perhaps the decision will be made by a yet-to-be-named vice president for facilities and campus management.

Since taking office as president Aug. 1, 2008, Pastides has restructured his vice presidents — not creating new positions, but redistributing their responsibilities.

As far as Innovista is concerned, the most important change has been removing direct supervision of Parks from the vice president for research — a position once held by Pastides — to the new vice president for facilities and campus management.

The new vice president for research — Stephen Kresovich — will take office Oct. 1 and will oversee USC’s research funding efforts and graduate school.

Parks also answered to former university vice president for business and finance Rick Kelly, before Kelly’s retirement July 1.

Moore, who now heads the university’s finances and planning, said he is Parks’ supervisor until a vice president for facilities is named and might also have a supervisory role after.

TO BE RESOLVED

Will Parks keep his job? Who will fill two vital vice president posts?

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