Officials are floating the idea of a four-floor expansion or spin-off site elsewhere for Rochester's Biobusiness Center.
The nine-story center, built for $34 million in 2009, is a victim of its own success.
Less than 10,000 square feet of space in the nine-story building is available for lease, said Gary Smith, president of Rochester Area Economic Development Inc. He estimates that within the next 12 to 18 months, the 150,000-square-foot building could be fully occupied.
"We need to start looking at what is the next iteration of the Biobusiness Center," Smith said.
Possible options include expanding up by adding four floors or building another facility somewhere else in Rochester, he commented. Smith added that such a project could be done as part of Mayo Clinic's Destination Medical Center initiative.
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Smith, the president of Rochester Economic Development Inc., spoke at Monday's Eggs & Issues discussion sponsored by the Rochester Area Chamber of Commerce.
"Rochester's entrepreneurial ecosystem took a great leap forward last year," Smith said, citing Mayo Clinic policy changes that encourage employees to start companies, the launch of the Mayo Clinic Business Accelerator to help startups and the creation of the $5 million economic development fund from local option sale tax money.
The Accelerator has 22 tenants leasing either workstation space or an office in the 2,500-square-foot center on the second floor of the Biobusiness building. Created by the city of Rochester, Mayo Clinic and RAEDI, the Accelerator has attracted many startups and venture capitalists.
One Mayo Clinic-spawned startup, Imanis Life Sciences, moved out of the Accelerator in 2013 and began leasing 1,736-square-feet market-rate space from the city on the first floor of the Biobusiness Center. Imanis also used venture capital money to pay off a $50,000 RAEDI loan it used to build a "wet lab" in its new offices. Smith said that is the first of the economic development loans funded by sales tax money to be repaid with interest.
Another Accelerator tenant is looking to follow in Imanis' footsteps and is negotiating to possibly lease space on its own, Smith said. Those success stories are spurring more young companies to be interested in the Accelerator.
"We're looking at the possibility of expanding the Accelerator right now," Smith said.
He estimated about 1,000 to 1,500 square feet of more space in the Accelerator will be needed within a few months to accommodate the growing interest from startup firms. That expansion could be located on the second or third floors for the Biobusiness Center at 221 First Ave. S.W.
This is a change in direction from just a few years ago, when the Biobusiness Center struggled to attract tenants to fill the building. About seven floors of the city-owned building is occupied by Mayo Clinic offices.
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"It's taken several years, but it's starting to become what we had originally visioned for that building. We're really getting started," said Smith. "We're trying to do something that's really unique."
