SIRTI takes action on wet-lab project

Foundation OKs borrowing $2.2 million; SIRTI pledges $250,000 to operate facility

By Megan Cooley Spokane Journal of Business

The Spokane Intercollegiate Research and Technology Institute has taken additional steps to pursue development of a new $6 million wet-lab facility here.

At meetings this month, SIRTI’s board pledged up to $250,000 to be used to operate the facility in its first three years, and the board of a separate entity, called the SIRTI Foundation, arranged to buy property for the structure and take out a $2.2 million loan to build it.

SIRTI is still awaiting word on a request for a $3 million grant from the U.S. Economic Development Administration to build the wet-lab facility. If SIRTI secures that funding, the foundation would provide matching funds by spending about $800,000 on a 78,000-square foot piece of land in the Riverpoint Higher Education Park, and by seeking a $2.2 million loan, says Patrick Tam, SIRTI’s executive director. The Washington State University Foundation preliminarily has agreed to sell the SIRTI Foundation that land, which is at the southeast corner of a block that’s east of Pine Street and south of Main Avenue near the Burlington Northern Santa Fe Railway Co. line, Tam says.

SIRTI’s action this month “is important because it shows that SIRTI is fully behind this project,” he says. “It’s very much in line with SIRTI’s mission to develop technology-based companies in the Inland Northwest.”

The two foundations haven’t engaged in negotiations yet over the price of the land, but Tam expects the price to be near that $800,000 estimate.

Tom Quigley, a member of the WSU Foundation’s board, confirmed that group’s intention to sell the land, which is vacant now.

“Now that SIRTI is moving ahead, WSU’s step is to arrive at a configuration (of the site), document the transaction between the two parties, and then make the transfers,” he says. “That should occur over the next several months.”

Because SIRTI is a state agency, it isn’t able to take out loans, Tam says. The SIRTI Foundation, however, is a nonprofit entity, and is able to borrow money, so the two entities agreed to allow the foundation to act as the developer of the wet labs. SIRTI would then lease the building’s entire 32,000 square feet of floor space, then sublease wet laboratories to companies for their use.

Tam says the SIRTI Foundation would pay off the loan with the income from SIRTI’s leases of the wet-lab space. An undisclosed bank has said it’s interested in loaning the $2.2 million the foundation needs, he says. When asked how the loan would be guaranteed, Tam said only that “right now the loan is not totally firm; it has some moving parts.”

Tam says SIRTI hasn’t decided what it would charge companies to lease the space, but rates would be comparable to what is charged for such space in the Puget Sound region.

He says it’s difficult to compare fees charged for renting wet labs here since there are so few and they are in such high demand.

SIRTI charges anywhere from $15 to $35 a square foot for wet-lab space in its building that it leases out now.

Tam says several companies, all of them locally based, have expressed interest in leasing space at the proposed facility, but he declines to name them or to say whether they are startups or established businesses.

Wet labs—usually defined as having sinks, a deionized water supply, ventilation hoods, and other specialized components—are used by biotechnology and biomedical companies to conduct research and develop new products. The Spokane-Coeur d’Alene area’s scarce wet-lab facilities, which include 2,000 square feet of such space at SIRTI’s building, 5,000 square feet at the University of Idaho Research Park in Post Falls, and 11,000 square feet in the Health Sciences Building at Riverpoint, are being used either by companies or for academic pursuits.

The facility proposed by SIRTI would have 12,000 square feet of wet-lab space, 10,000 square feet of office space, and 10,000 square feet of other lab space that could be converted to wet laboratories in the future.

In March, the EDA invited SIRTI to apply for a grant, and SIRTI submitted a proposal last month. Although the competition for such funds for is fierce, SIRTI has a good shot at the money, Tam says.

“They haven’t committed the funds, but they have indicated to us that our project is most likely in line for fiscal year 2004 funding,” Tam says.

Word on that decision could come within the next several weeks. If SIRTI wins the grant, the money could come any time after the federal government’s next fiscal year begins in October.

“If things really move well, if we’re funded in December, we could break ground in April,” Tam says. “We’re hoping to construct over the summer and have the building ready by late fall” of 2004.

Like Tam, Spokane Mayor John Powers says he is optimistic that the project will come to fruition.

“I think it’s a natural fit here,” he says. “I think we’ve positioned ourselves well, and it’s a community-supported project. … It’s a cornerstone of the conversion of the Riverpoint (Higher Education Park) into a true university district.”

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