$1 billion bioscience center planned for Rochester area
California developers are poised to announce an effort to raise $1 billion to create a bioscience research center just outside of Rochester. The Elk Run project has drawn the interest of one of the industry's leading developers. If successful, it could turn the region into a national center for research into new drugs, medical devices and other breakthroughs. The site is known as Elk Run, and these days, it isn't much to look at. It's a fenced stretch of vacant land along Highway 52, about 10 minutes north of Rochester.
The California real estate company that is developing the site has been meeting with state and local officials to tell them it wants to start work on a 1,700 acre mixed-use residential and business development, centered around a biotech business campus.
That firm, Tower Investments, hopes Steven Burrill, the venture capitalist, will fund research there for experimental drugs, treatments for diseases and medical products, sources tell MPR.
Gov. Tim Pawlenty -- who has long pushed for Minnesota to become a bioscience leader -- confirmed this week that his administration has talked to Burrill and his associates about the project.
"We've had meetings and discussions with them, and it's a hopeful project, and one that they continue to work on," Pawlenty said. "I don't want to speak for them, but if they can get a few more items lined up, that's something you'll be hearing more about in the coming weeks and months."
The project would require millions of dollars worth of groundwork. The state has already committed to more than $1 million worth of sewer and other improvements on the site.
Several legislators say MnDOT is also weighing a $50 million project to improve highway access to the site.
U.S. Rep. Tim Walz, who represents the area, told MPR he met with developers this week to talk about the highway project, including the potential for using federal stimulus funds for highway access.
The developers have included a representative of the Mayo Clinic on the project's board, and sources say the developers would like to get the world-famous medical center to join the venture. Those sources are people who have been provided details of the project, but asked not to be identified before a formal announcement.
Venture capitalist Steven Burrill also declined an interview request. But news of the potential billion-dollar development has legislators, University of Minnesota researchers and the venture capital community talking.
"Is there skepticism? Probably. There always is when you're talking about a big project," Demmer said. "But as with anything else, if you make steps along the way, as you get closer, the reality starts setting in that this can be done. And we know these kinds of things are being done. Why not here?"
In fact, outsiders, including Pete McNerney, a Minneapolis-based biotech investor, say the site's proximity to Rochester and the cachet of the Mayo name could put the state on the biotech map.
"If it were known that there were that kind of money available, there would be a lot of people approaching whoever makes the decision," McNerney said. "The trick, of course, would be which ones to invest in and which ones would move to Minnesota."
The state has had a checkered history with medical innovation. It has successes like Medtronic, the large medical device maker based in Fridly. But a $24 million investment in the University Enterprise Laboratories project in St. Paul is foundering.
So McNerney remains skeptical. The economy is sagging, and even companies like pharmaceutical giant Pfizer are laying people off. Good intentions and money don't guarantee success.