Bill aids biotech lab developer

By Andrew Gomes
Advertiser Staff Writer

•	SB 3091 hearing today A measure to allow the sale of bonds for biotech lab space will be heard by the Senate science, art and technology committee today at 2:45 p.m. in the state Capitol conference room 225.

Senate Bill 3091 proposes allowing the state High Technology Development Corp. to float the bonds, which would be the debt of a private developer that agrees to build biotech "wet lab" space near the University of Hawai'i medical school and cancer research center.

The financing option provides a private developer the same tax-free bond financing available to the state in return for furthering the goal of growing Hawai'i's fledgling tech industry and helping diversify the economy.

Phil Bossert, executive director of the High Technology Development Corp., said the agency was considering developing a small wet lab incubator and was bombarded by requests to provide about 10 times as much space, or roughly 300,000 square feet.

"That's not an incubator anymore," he said. "The demand for the space is huge."

The HTDC effort shifted to discussions with developers, Bossert said. This has included talks with Kajima Corp., which owns Hawaiian Dredging Construction Co. and is helping build the UH medical school, and Kobayashi Group, which is a partner in the high-end Kaka'ako high-rise Hokua.

Mainland developers with biotech facility construction experience may also be interested, as well as local developer Marshall Hung of Waldron Ventures, who previously considered an estimated $100 million research facility on Kamehameha Schools land next to the medical school.

Bossert said there are four or five suitable state-owned sites, though the wet lab project could be on private property.

Part of the HTDC's role is to fast-track technology-related development that Bossert said could cut a year off the typical permitting process, though the Hawai'i Community Development Authority, the state agency overseeing development in Kaka'ako, also has relatively fast permitting controls.

The HTDC has helped develop Mililani Technology Park, West Kaua'i Technology Center and a tech park on the Big Island. It also operates the Manoa Innovation Center and Maui Research & Technology Park incubators.

Bossert said the agency is interested in being a nonprofit operator of the Kaka'ako biotech incubator, which would help reduce operating costs.

"The goal is to keep the price of the space down to be attractive for companies to move there," he said.

David Watumull, president and chief executive officer of Hawaii Biotech Inc., said his firm is growing out of its space at a former sugar industry research facility in 'Aiea.

"Expansion is expensive and difficult where we are currently," he said, adding that he views being near other biotech researchers as a strategic advantage.

Ted Liu, director of the state Department of Business, Economic Development & Tourism, recently said the few biotech companies in business here have told him they would commit to taking roughly 100,000 square feet to 125,000 square feet of space today if it were available.

Nonprofit economic development group Enterprise Honolulu also recently reported that at least eight biotech firms considered establishing themselves here last year but didn't because of a lack of leasable wet lab space.

Wet lab facilities typically feature easily reconfigurable areas with contamination-proof "clean rooms," high-speed data connections, backup power and specialized ventilation and waste disposal systems.

The buildings are more expensive to build than office space, which is one reason why the HTDC is trying to ease developer costs with the bond financing.

Introducing the bill were Sens. David Ige, D-16th (Pearl City, 'Aiea), and Carol Fukunaga, D-11th (Makiki, Pawa'a). A companion bill in the House was introduced by Rep. Brian Schatz, D-25th (Makiki, Tantalus).

"This comes up over and over again as a real pressing need," Fukunaga said. "Hopefully there will be private-sector partners wanting to jump in and invest."

Reach Andrew Gomes at agomes@honoluluadvertiser.com or 525-8065.