Tax increment financing to accelerate development at Coldstream Research Campus
Editor's note: Gov. Steve Beshear joined members of the Kentucky General Assembly at the state Capitol on March 22, 2011 to sign HB 310 into law, amending and expanding the state's Tax Increment Financing (TIF) program. The bill expands the TIF program to include mixed-use development projects located in a research park owned by a public university and to include projects located within three miles of a military base that houses, deploys or employs at least 25,000 military personnel, their families, military retirees or civilian employees. more
LEXINGTON, KY (March 22, 2011) —The University of Kentucky will use a new law that permits the establishment of a tax increment financing (TIF) district on the Coldstream Research Campus to help finance much needed laboratory and incubator space. UK will solicit a master developer to build a mixed-use "town center" and use the taxes generated to fund new research buildings and be a catalyst for retaining and recruiting biotech companies to Coldstream.
"We need new R&D facilities at Coldstream to keep high-tech spinoffs from UK and other research intensive companies in Lexington," said George Ward, Coldstream Research Campus executive director. "We are currently leasing the last of our wet lab space, and without the TIF incentive, it is highly unlikely that a developer will build laboratory space because it costs three times more than typical office space."
The development plans are also expected to focus recruitment on small to mid-size biotech and life science companies. Ward will market Coldstream to companies interested in working with researchers at the University of Kentucky and companies that want to be located near sterile pharmaceutical manufacturing facilities.
A request for proposal will be released within the next 60 days to select a qualified master developer to design and build the town center and restore the historic Carnahan House on 35 acres of the TIF district. Ten acres of park land included in this area TIF area will not be developed, but will be improved to provide a connection to new research buildings.
It is envisioned that the town center will include several three or four story buildings. The new buildings might house a cafe, sandwich shop, bar and grille, or service amenities on the ground floor, with offices and residential space on upper floors. Service amenities might include a branch bank, day care, fitness center, dry cleaning or overnight shipping. A renovated Carnahan House with public meeting space on the first floor and offices above will be the centerpiece of the new development.
According to Len Heller, UK vice president for Commercialization & Economic Development, "The proposed ‘lifestyle’ development will align perfectly with our mission at Coldstream to cultivate an innovative community by combining UK's research strengths with private enterprise. A town center is necessary infrastructure for us to meet the needs of the new generation of high-tech workers who want this type of community where they can live, work, play and learn.
A June 2009 feature in Business Week titled "Research Parks for the Knowledge Economy" details how research parks around the world are building amenities to gain a competitive edge. "The trend is to nurture living, breathing communities rather that sterile research silos. It means cafes, parks, entertainment spots and social centers where entrepreneurs, engineers, and designers from many disciplines can mingle and network."
Both Heller and Ward have been working with local and state government and local design and development-related professionals on plans for the proposed development. They will continue to seek input throughout the request for proposal process from all groups, including neighborhood associations around Coldstream.
An advisory committee including architects specializing in building design, landscaping and environmentally responsible building practices, and a representative of the Lexington-Fayette Urban County Government will provide technical assistance during the selection of a master developer.
The University of Kentucky Board of Trustees will have final approval on the agreement with the recommended master developer.
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