County refocusing oldest business incubator from biotech to cybersecurity (Silver Spring: real estate, 2014)

[Mr Beco]

Friday, January 10, 2014

County refocusing oldest business incubator from biotech to cybersecurity
Some companies will be forced to move



A key part of a refocusing program for Montgomery County’s innovation centers is taking shape, as officials plan to move tenants out of the county’s oldest center for early-stage businesses by this summer.

The county plans to work with the National Institute of Standards and Technology and the state of Maryland to renovate the William Hanna Center for Innovation at Shady Grove — which dates to 1999 as Montgomery’s first business “incubator” — as the home of the National Cybersecurity Center of Excellence.

“Somewhere in the country will be the hub for civil cybersecurity,” said Steven A. Silverman, director of the county’s Department of Economic Development. “And we think it should be in Montgomery County.”

NIST, a Gaithersburg-based federal agency under the U.S. Department of Commerce, is in the process of obtaining a contractor to operate the facility as a federally funded research and development center. The public-private entity formally started almost two years ago to bring together experts from industry, government and academia to work on cybersecurity needs.

The agency plans to award a contract to operate the center proposed for five years with a value up to $400 million, according to a NIST news release. NIST also is working with private high-tech companies such as Microsoft and Hewlett-Packard, which are providing software and other resources to the center’s work.

“It’s an opportunity to leverage millions of dollars in federal money that is going into cybersecurity and bring cybersecurity companies to the county,” Silverman said. “We want to get these private partners to open offices here.”

That will result in some pain to the 34 companies in the innovation center, some of which have been in the Rockville-Shady Grove area for several years. Most of those are in the life sciences.

There is space at the Germantown innovation center and in the private sector, Silverman said. Johns Hopkins University also has businesses with space within the Rockville campus.

“We intend to work with each one individually to find a good solution for them,” Silverman said.

Once the companies are moved, the renovation process should take a few months, he said, though he was not sure about the timeline.

In October, Silverman and others spoke before a County Council committee about a plan to reorganize the five innovation centers to better focus them and provide more intensive services that can make tenants grow faster.

One proposal calls for focusing the 23,000-square-foot downtown Rockville one on data analytics, while the 32,000-square-foot Germantown center, the newest one that opened in 2008 with 45 offices and 11 wet labs, would retain its life sciences focus.

The 20,000-square-foot Silver Spring center, which formed in 2004 and is in the only building owned outright by the county, would become an accelerator, which provides more intensive programs, including access to funding, in a fixed, reduced time frame. The 12,000-square-foot Wheaton facility, the smallest one, which opened in 2006, would close once its lease is up in 2016.

That plan is on hold while the county moves forward with the program for the Shady Grove center, Silverman said.

The five centers now have an annual budget of about $4.5 million, with about $2.5 million recovered in rent, licensing fees and other income. The idea is to move away from the county doing real estate management to get more investment and partnership management, Silverman said.

The incubator program has graduated more than 100 companies into private space since forming in 1999.