Consultants' Report Says Innovation Park will Create more than 5,000 Jobs

Construction costs for the full development of the University of Nebraska-Lincoln's research campus are expected to top $800 million,according to a plan prepared by a team of university-hired consultants.

November 18, 2009

That bill includes more than $195 million for the first phase of development at Innovation Campus: a renovated 4-H Building, a UNL-U.S. Department of Agriculture research facility, a companion UNL research building, a hotel and more.

It also includes $606 million for future development, including more UNL research facilities, core lab space, private offices and residential and retail space.

Innovation Campus, to be built at State Fair Park, will require significant investment from the state, the university, donors and more.

That's complicated by a daunting economic downturn forcing millions in cuts on the university system. Consultants also caution that early success at Innovation Campus will be key to maintaining local businesses' support for the project.

Despite the challenges, university leaders pledge the campus is worth it.

"There are obvious challenges launching this in the midst of a recession," NU President J.B. Milliken, attending a conference in Washington, D.C., said via email.

"On the other hand, Nebraska's long-term economic well-being depends on creating high-quality, high-paying jobs that will keep our young people in Nebraska and attract others here."

Added UNL Chancellor Harvey Perlman, who was also at the conference: "Any project of this size is going to be a major invest- ment.

"I don't think you make progress unless you're willing to make some investments."

When fully developed, Innovation Campus is expected to generate 5,525 jobs, according to the business plan from a team led by Omaha-based Noddle Cos. Many of those jobs will be research and technician positions with average salaries of $70,000.

As a result, earnings in Nebraska will swell by $266.9 million over time, the team's report says, in addition to the grants and spinoff business that's expected to come with developing the research campus.

That business plan, along with a physical master plan prepared by a team led by Ann Arbor, Mich.-based SmithGroup/JJR, is scheduled to go before the NU Board of Regents for approval on Friday.

Before their vote, the regents will take a bus tour of the fairgrounds, including stops at the 4-H Building, which consultants say should be converted into a central commons area, and the Industrial Arts Building, which is recommended for demolition.

Innovation Campus business and master plans are due to the Legislature by Dec. 1. UNL will acquire the 251-acre State Fair Park on Jan. 1 to begin developing its research campus; the fair is moving to Grand Island. In the business plan, consultants suggest a variety of funding sources: university and state coffers, private donations, tax increment financing, bonds, federal grants and more.

Milliken and Perlman agreed it's too early to specify how much the public will chip in but said a general model for money for the campus is one-third public, two-thirds private.

Private companies chosen to locate at Innovation Campus must complement university research strengths, Milliken said. Those are water, food, agriculture, biofuels and more.

"We want businesses who will hire our students as interns, send their employees to our graduate programs, collaborate with our faculty and, most important, hire our graduates," he wrote.

Perlman said he's continuing to hear from interested companies, but he wouldn't name them.

Innovation Campus' first tenant is expected to be a U.S. Department of Agriculture facility that has been championed by Sen. Ben Nelson.

A privately funded companion UNL building will follow.

Basic infrastructure - expected to cost $19.4 million in Phase I alone - will be an immediate need, along with the 4-H Building renovation, to foster a sense of "place" on the campus, Perlman said.

How quickly UNL will be able to fund those needs remains to be seen. University leaders have long said full development of Innovation Campus will take two decades or more.

In their business report, consultants said interviews with community leaders revealed early success at Innovation Campus will be critical.

"A concern identified by some stakeholders was the risk that nothing new would be brought to the (campus) within its first few years of development," the report said.

"If this occurs, local business support could be dampened and the sense of a shared vision for the (campus) that exists presently could be adversely affected."

Perlman agreed early success would be ideal but cited looming budget cuts - NU faces proposed cuts of 1.8 percent this fiscal year, 3.4 percent next year - as causes for concern.

"With the economy and cuts that I'm looking at, it's increasingly difficult to see how the university is going to be able to fund the infrastructure and 4-H Building," he said."That may delay us.

"There are high expectations that something will happen quickly, and I hope it will. But I can't predict it."

Milliken cited Centennial Campus at North Carolina State University, one of the nation's most successful research campuses and the site of a visit by NU leaders and regents two years ago.

At that campus, now 20 years old, it took years before even the second building was finished, Milliken said.

"No one is more interested in early success than I am," he wrote.

"But as excited as I am about this project, people need to be realistic."

Milliken said he's increasingly convinced Innovation Campus is "a strategy that makes sense."

"It will take time to do it right," he wrote, "but we have a good plan, and we have excellent university programs and other assets on which to build."

Reach Melissa Lee at 473-2682 or [email protected]

Estimated Innovation Campus costs

Here are the facilities planned for Innovation Campus and how much they're expected to cost.

Phase I:

· U.S. Department of Agriculture research facility, $39.9 million

· Companion University of Nebraska-Lincoln research building, $56.5 million

· 4-H Building renovation and corresponding 400-stall parking lot, $21.5 million

· 135-room hotel, $18.1 million

· Public-private office and lab space, $39.8 million

· Basic infrastructure, $19.4 million

Total Phase I costs:

$195.2 million