The state’s High Tech Development Corp. operates the Manoa Innovation Center on land leased from the University of Hawaii. The 20-year lease expires in 2015.
HTDC CEO Yuka Nagashima wants to extend the lease, but UH President M.R.C. Greenwood wants to take the property back. What will this do to MIC? Is it the right thing?
Under the HTDC, the Manoa Innovation Center has become a second home to the people there — clean as a pin, with grassy courtyards, conference rooms and ample parking. It has innovation written all over it. It’s a prize and maybe that’s the problem.
The 25 startups at MIC work in materials science, engineering, pharmaceuticals, computer software and hardware, defense, security, financial planning, biotech, social media, photonics, apps, you name it.
It’s not only MIC’s physical attributes that bring these startups together, but also the networking and mentoring they get at MIC. It’s the perfect place for startup synergy, collaboration and partnership.
A startup at MIC can expect to pay about $2.50 per foot. From this, HTDC gets $1 million in rent every year. This is tiny compared with UH’s $1.4 billion budget but helps HTDC cover its program expenses.
While MIC incubates companies that commercialize technology, UH has had challenges commercializing the tech research that it does. To some extent, MIC has incubated startups that use UH technologies, so you’d think UH would want to keep MIC around.
Two years out, the situation is becoming desperate, and the lack of certainty pervades daily life at MIC. There are plans to find another building elsewhere, but that will require millions. It’s unlikely that this can be done on time, and it will be disruptive. Some say things will never be the same.
UH says it needs MIC’s 40,000-square-foot building for office and research space. But, really, wouldn’t it be easier for UH to find other space on its sprawling Manoa campus than to require HTDC to go out into the economy and find or build a new MIC there?
The equities are compelling. Granted that both UH and the HTDC need space, UH has a $1.4 billion budget and campuses of hundreds of acres. The HTDC has the one building. Who is better prepared to find space?
As a public university, UH should provide service to the community, including government. Inserts like the one in last week’s Star-Advertiser are not the best way to do that. Innovation Councils like the one created in 2010 are not the best way, either.
That council did not include members from the downtown venture capital community or HTDC. After a year it issued a disappointing report. No action has been taken for commercialization.
At the same time, to the frustration of researchers, UH has all but abandoned the University Office of Technology Transfer and Economic Development that was supposed to help in commercialization.
As we approach expiration, what can be done to save MIC? Because UH and MIC were both created by the Legislature, it doesn’t seem appropriate for one to displace the other. Should the Legislature step in?
Last year, SB 4125 would have transferred the lease to HTDC. It was deferred. This year, SB 477 would do the same thing. HB 71 would extend the lease by 25 years. MIC supporters will support these bills.
The future of MIC hangs in the balance. Can’t this be amicably resolved? Isn’t there common ground? Wouldn’t a reasonable extension be in order?
Or could there be an agreement by which UH would give MIC a new lease for a new term after the old one expires? But note that if MIC has to pay rent under that lease, it would need additional funding to cover its programs, and that could be a problem.
Also, since UH is lacking on commercialization, MIC could be a pathway to commercialization of UH tech research. Since Greenwood wants to do "research as a business," commercialization using MIC’s services would help. If UH is serious about commercializing its technology, it should develop this pathway with MIC. It would be shortsighted to send MIC away.
Where the Stevie Wonder affair involved $200,000, the MIC issue will involve hundreds of millions, the future of a state agency and a program affecting our economy. Dealing with it is not a simple mater, and UH should spend at least as much time doing the right thing.
The regents have not yet considered the future of MIC. They need to take it up, and we will need to see how they do. If they fail to resolve it in a way that will save MIC, the Legislature will have to act.
Whatever we do, it’s critical that we save MIC, in Manoa, where it belongs.
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Jay Fidell, a longtime business lawyer, founded ThinkTech Hawaii, a digital media company that reports on Hawaii’s tech and energy sectors of the economy. Reach him at fidell@lava.net.
