Capital Investment in Life Science Incubators and Accelerators Tops $1 Billion Over Five-Year Period

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Reported by Annette Kreuger Industrial Info Resources (Sugar Land, Texas)--What does Cambridge's MIT and Phoenix's Maricopa Community College have in common? Both believe in constructing life-science accelerators and incubators. The idea of funding these projects to lure promising companies to an area is not a new one. What is new is the growing number of these projects across North America and who is building them.

The first incubators typically were placed in vacated industrial buildings, the paltry funding invested by anxious communities hoping to kick-start new businesses. Fast-forward to today, and the cast of players has expanded to include the majority of top universities and major development companies--which are often investing millions, rather than the former thousands of dollars, to build elaborate facilities offering fully outfitted wet laboratories and state-of-the-art infrastructure.

The newest of these projects are often collaborative in design, in that multiple disciplines can be brought together in one place, offering complementary aspects of the industry rather competitive. In some cases, pilot-scale manufacturing space is available.

In addition to the noble cause of helping to launch young businesses, the hope is that when a company makes it, so to speak, they grow in place. The majority of these facilities are being built in business parks, with the vacant land and incentives in place to make that happen.

A recent of Industrial Info's Pharmaceutical-Biotech Industry Database revealed 44 accelerator and incubator projects reported over the past five years. Those 44 projects represent a total investment value of $1.1 billion; 29 of the 44 have been completed and are operational, carrying a TIV of just under $600 million. The remaining 15 are active (in various stages of planning, engineering or construction) and are worth $556 million in construction investment.


Ranging in TIV from $1 million to hundreds of millions (for full master plan build-out), the projects rarely top $5 million for an initial investment. The newest of these projects to open its doors is LabCentral in Kendall Square, Cambridge, Massachusetts. The $7.5 million facility was completed last month and will house multiple early-stage research companies in an MIT-owned building located at 700 Main Street.

The non-profit LabCentral was created earlier this year to facilitate the incubator's evolution intro reality and provide management once it opened. There is room for up to 25 start-up companies in the 28,000 square foot space, with laboratory and office space to house up to 100 researchers and other nascent entrepreneurs.

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