Biotech: A Boon for Lower Manhattan?By Erica Pearson
In San Francisco, the biotechnology industry provides jobs for 75,000 people. In Boston, 25,000 jobs. In New York, however, fewer than 1,000 work for a biotech company.
Now, a new plan to bring a biotech hub to lower Manhattan aims to more than double that number, and fill 300,000 square feet of office space vacated after the September 11 attacks.
But the proposal, which was developed by a coalition of city groups and institutions, has several obstacles. First, biotechnology companies tend to cluster in places where a large number of similar companies already exist. Right now, that means Boston, San Diego, Washington D.C. or San Francisco, not New York.
Another setback, according to New York City Partnership president Kathryn Wylde, is that some of the largest tax breaks available to companies in New York don't apply to biotechnology firms.
"You can build a steel plant with triple-tax exempt financing, or you could build a doll factory. But we can't build for the 21st century," said Wylde, referring to breaks from city, state and federal taxes.
Wylde and other advocates of the biotech hub plan, called the Lower Manhattan Biotech Initiative, are calling on the city and state to make it easier for companies to locate in lower Manhattan. They say that a biotech center downtown would be a key component to rebuilding the area near the World Trade Center site.
A HUB FOR THE FUTURE?
The lower Manhattan project proposes to convert 300,000 square feet of office space, vacated after the 9/11 attacks, into space suitable for biotechnology use. The center could provide about 1,300 new jobs downtown. All of the city's major medical institutions have signed on to the lower Manhattan plan, saying that it could spur new centers throughout the city.
Advocates say focusing it in lower Manhattan could draw companies that are now heading to cities like San Francisco or Boston. "We are not considered a center," said Wylde, "and it is a self-fulfilling prophecy."
"The prospects for biotechnology here could change, rapidly and dramatically, if we decided to promote our many strengths," Memorial Sloan-Kettering Cancer Center president Harold Varmus wrote in a recent editorial supporting the lower Manhattan project. Varmus said that, after moving here three years ago, he was frustrated to see so few biotechnology companies in New York, even though the city's centers and universities make the city one of the largest recipients of National Institute of Health funds for medical research.
STATE AND CITY SUPPORT
Building a downtown biotech hub would cost $90 million, and some see the state's contribution as a meager start, considering that Governor George Pataki has given nearly $200 million to fund similar projects in Buffalo, Syracuse and Long Island.
"The $5 million is barely a drop in the bucket for what really is needed for the downtown biotech project, or for the biotech industry in New York City," said Jonathan Bowles, research director at the Center for an Urban Future. "All of the big bucks are going elsewhere in New York State."
In August, Bowles's organization issued a report arguing that Albany should focus funds for biotech development in New York City, not upstate or in the suburbs, because the city has the medical research institutions and scientists that the industry needs to thrive.
DOES IT MAKE SENSE?
"Biotech startups are complex and iffy, burning tons of cash through long development cycles, and even a substantial biotech sector would hardly be able to replace financial services," Florida wrote. "It's never wise for communities to bet a big chunk of the farm on one industry--be it biotech or baseball. Even a hot growth industry may cool off or evolve in unexpected ways."
Bowles, from the Center for an Urban Future, said that he can understand why Florida and others are concerned. "However, I think that at a time when we really need to be diversifying the economy, biotech is just one sector we need to be focusing on," he said. "It is one of the few sectors that actually shows promise for growth."