After almost a decade of planning, the pieces are falling into place to rework the heart of the University of Kentucky’s Coldstream Research Campus into an attractive lifestyle community for today’s tech-oriented young professionals—along with the research-based companies that want to employ them.
The total projected private investment for Coldstream’s TIF district, which has also received preliminary approval from the state, is estimated at $199 million, with approximately $33.1 million in planned public infrastructure improvements that could qualify for TIF reimbursement.
LFUCG also approved a change earlier this year to redefine Coldstream’s P-2 zoning, a category exclusive to Coldstream in Fayette County. The zoning category has been renamed as a University Research Campus Zone and, in addition to allowing for multi-family residential, it now allows for more density in its development, with larger buildings that no longer need to be built on the minimum five-acre lots or set back 50 feet from interior roads, as previously required.
The aim, said Coldstream director George Ward, is to build a more engaging, pedestrian-friendly community, with attractive common spaces, amenities and conveniences that appeal to the skilled next-generation employees that research-based firms hope to recruit.
“A lot of people describe it as ‘live-work-play,’ and we’ve added ‘learn,’ because of our research element,” Ward said. “We are not trying to re-create a major retail center like Fritz Farm, but we would like a place where people can find a variety of places to eat and outdoor activities they can enjoy.”
Attracting a skilled workforce
It’s a tactic that more university research parks across the country are beginning to embrace, particularly in urban communities ripe for redevelopment, according to a report released by the Association of University Research Parks (AURP) in 2013. According to the AURP report, only 6 percent of university research parks incorporated mixed-use development into their sites in 2012, but that number was projected to rise to 21 percent within five years. The primary aim for UK and others is to keep one of their biggest economic development assets—university-trained talent—close to home.
“The reason a company locates at a research campus is to have access to talent. That includes both the students we are training at UK and also the world-class researchers we have there.” —Coldstream director George Ward
“The reason a company locates at a research campus is to have access to talent,” Ward said. “That includes both the students we are training at UK and also the world-class researchers we have there.”
In February, Coldstream issued a request for proposals for the development of a multi-family residential village on a 13-acre lot to the west of the Embassy Suites Hotel, within the planned TIF district. Among Coldstream’s objectives for the multi-family development, according to the RFP, is the creation of a walkable campus environment and a culture of high energy tailored to young professionals, incorporating LEED building principles, outdoor sculpture and public art, maximized green space and access to public spaces, parks and other amenities.
Coldstream is currently considering several submitted proposals on the project and expects to select a developer in the coming weeks, Ward said. Barring any unforeseen delays, the contract for construction of Coldstream’s residential community should be inked by the end of the year.
More space for emerging early-stage companies
While the multi-family residential project, and the eventual restaurant and retail, are key elements in attracting the skilled employee base that research companies desire, most of the newly built space within the TIF district is planned as office and lab space for emerging research-based enterprises. Coldstream is in the early stages of planning for a new business incubator, with construction projected to begin by 2020.
Companies like Summit Biosciences and Piramal Laboratories have increased their footprints at Coldstream significantly in recent years, absorbing the campus’ available space to meet their expanding business needs. Piramal, which acquired Coldstream Laboratories in 2015, has since expanded that facility with a 3,900-square-foot addition and leased an additional 16,000 square feet in the Coldstream Center Building at 1500 Bull Lea Road. They are currently negotiating to add 10,000 more square feet. Summit has grown from its original 10,000-square-foot office space at Coldstream’s Technology Center to take occupancy of an additional 18,000 square feet in the Coldstream Center, and the company also added 3,500 square feet in another nearby building for its office staff.
The activity has created positive energy at Coldstream, but it also means more space needs to be built for new businesses, in partnership with private developers who understand the needs for flexibility and scalability that early-stage companies require, Ward said.
“We want to create another incubator-type building that would be a next step for the early-stage companies [currently housed in UK’s on-campus AsteCC incubator], so that when they grow to a size of 10 employees or more, they can come here and have a similar multi-tenant experience,” Ward said.
Early-stage companies need flexible space that can grow with them, Ward said, or also scale down if their funding slows down or the economy takes a hit, for example. The TIF provides an effective tool to incentivize developers to take more risk and provide more flexibility to accommodate early-stage companies, he said.
Land swap still in the works
At the same time, the university and LFUCG are also currently in talks on a possible land swap deal that would convey roughly 250 acres of university-owned property to the city, which could ultimately then be sold by the city to job-creating companies. The deal, which would give UK control of several city-owned streets on its main campus, would convey nearly 50 acres of “shovel-ready” property within Coldstream near Citation Boulevard, the development of which would need to conform to Coldstream’s standards, and 200 acres of current farmland along I-75 adjacent to Coldstream. The land swap has been approved by the state and the UK Board of Trustees and is currently working its way through the LFUCG council’s approval process.
“This type of development attracts others to it. It makes the overall real estate location even better.” —George Ward
Land within Coldstream is only available for lease from the university, and the ability to purchase land outright on the nearby 200-acre parcel could inspire more companies to add Lexington to their shortlist for site selection, Ward said, creating even bigger economic development and job-creation opportunities for the city and its nearby retooled research campus community.
“This type of development attracts others to it,” Ward said. “It makes the overall real estate location even better.”
A Coldstream success story:
Summit Biosciences expands to serve international market
Since receiving FDA approval of its first product in 2016, a generic, single-dose prescription nasal spray for treating migraines, Summit Biosciences has launched ahead into commercial-scale manufacturing.
The product, Sumatriptan Nasal Spray, created by Summit and the generic pharmaceutical firm Lannett Company, represents the first and only generic version on the market today, and it has set Summit apart as one of very few companies worldwide that is currently capable of delivering unit-dose products on a commercial scale.
In September, the company earned EU approval for the commercial manufacture of prescription nasal spray products for export to European customers, and it is currently preparing for the launch of its first single-dose intranasal product for a European client, targeted for international distribution. Summit is waiting on FDA approval for a second product for the U.S. market.
Founded at Coldstream Research Campus in 2009, at the height of the national economic downturn, Summit filed its FDA application for the Sumatriptan product in 2012, and its approval took three years. Now the company employs more than 100 people at Coldstream, and it anticipates further expansion as it continues to increase its capacity.
“We are transitioning from a small company to a large company, and buying a large building is an important decision,” said Greg Plucinski, Summit’s chief operating officer. “We have to grow our footprint with the business.”
Plucinski credits the company’s success to its hard-working staff and the determination of founder, chairman and CEO Edwin Cohen to grow the research-based company in Lexington, along with the company’s good fortune to encounter a few lucky breaks along the way. The support of about 100 Kentucky-based angel investors has been crucial to the company’s growth and development, he said, and the company has also received both city and state incentives for high-tech job growth.
Summit has exceeded its hiring projections, Plucinski said, and finding the right employees can be challenging, especially in today’s increasingly tight labor market. The company employs a wide base of workers, ranging from students to retirees. The company’s higher profile has started to draw interest from Kentucky transplants looking to return to the state, he said.
“We get a lot of [job applicants from out of state] who said they grew up in Kentucky, and they see what we are doing and they’d really like to come home,” Plucinski said.
He said the close relationship with the university has helped, and he’d like to see even more co-op programs to strengthen the pipeline of local workers.
Plucinski added that the new developments at Coldstream, including the plans for more mixed-use and the university’s proposed land swap with the city, are beneficial, primarily because they will help in attracting a larger base of research-oriented enterprises to the area, making it more appealing to potential job recruits.
“For a company to lease property and put a big investment on it, it’s challenging to get people to buy into that,” Plucinski said. “If the city has property that can be purchased, I think that will be more attractive for many companies.”