U-M leasing Pfizer labs

Spark plans to sublease space for startups' incubator

Ann Arbor News – Friday, April 20, 2007

By Jenny Rode

After months of planning, a high-tech research lab planned as an incubator for startup companies is moving forward with an important new partner: the University of Michigan.

Early next year, U-M will become the main leaseholder for 34,400 square feet of lab space at 2900 Huron Parkway, north of Plymouth Road currently occupied by Pfizer. The space is not located on Pfizer's main campus.

The university will then sublease some of the space to Ann Arbor Spark, the area's economic development agency, for a wet lab incubator to be occupied by several startup companies.

A wet lab is a climate-controlled, sterile and specially ventilated space used for high-tech chemical and biological research. Officials from Spark said they have been working on the project for nine or 10 months.

U-M Vice President for Research Stephen Forrest said U-M's involvement with the project is critical because the building's owner needed a committed, long-term anchor tenant.

In addition to U-M needing that kind of space for its own research, Forrest said, the university recognized it could help its own technology transfer spinoffs as well as local biotechs in need of wet labs.

"The university understands the urgency to get the space established ... there are companies on the cusp of getting funded and needing the space,'' Forrest said. "The university needed to get involved to move this forward.''

If successful, those startups would create new jobs and give the economy a boost, he noted.

The U-M Board of Regents approved the university's involvement in the project at its meeting Thursday.
Several lease agreements are either signed or are expected to be signed in the coming weeks for the building, which is owned by First Martin Corp. Among them:

Spark will lease 12,000 square feet from Pfizer until the end of 2007. Pfizer still occupies part of the facility and is the main leaseholder until the end of 2007.
U-M will lease 7,000 square feet from Pfizer until the end of the 2007 for the medical school's pathology department to use.
In January, U-M will sign a five-year agreement with First Martin for 34,400 square feet of space and become the main leaseholder. U-M will then sublease 12,000 square feet to Spark for the wet lab.

Several local companies are said to be in negotiations to use the wet lab space: Lycera Corp., AA PharmaSyn LLC, TCH Pharmaceuticals, Phrixus Pharmaceuticals and OncoImmune Inc.

Spark spokeswoman Elizabeth Parkinson said negotiations are ongoing and one or two of the companies Spark is working with may not occupy the Huron Parkway space.

Mike Finney, president and chief executive officer of Spark, said any company that occupies the wet lab incubator would be offered subsidized leasing.

Phrixus Pharmaceuticals Chief Scientific Officer and former Pfizer employee Bruce Markham said he hopes to be in Spark's wet lab space in a few months.
"The facility is really very good, and I was very happy when they decided that was the space they were going to take,'' he said.

Stephen Rapundalo, executive director of MichBio, the Ann Arbor-based association for the life sciences industry, said the wet lab incubator is just what the community needs.

"There hasn't been enough wet lab incubator space to accommodate prospective entrepreneurs,'' Rapundalo said. "With the Pfizer situation, there's a greater demand ... and this is coming on line just in time to capture some of that fallout.''

Finney estimated there is demand for about 20,000 square feet of wet lab space.

"So part of the effort is to identify space for those companies that we're not able to service,'' he said.

Jenny Rode can be reached at jrode@annarbornews.com or 734-994-6843.