🔒UConn incubator program enforces new five-year limit for tenants with goal of bringing in more startups

For the first time in its two-decade history, the University of Connecticut’s Technology Incubation Program has begun enforcing a five-year limit on participation.

In June 2023, TIP leadership informed 16 startups occupying UConn-owned lab and office space in Farmington they had a year to relocate. These companies had occupied incubator space for between six and 12 years.

Biologist Triantafyllos Tafas, founder and CEO of biotech startup QCDx, said there are no hard feelings. Quite the opposite — UConn partnered with developers and brokers to help its incubator “graduates” find new homes. Ten have already; four more, including QCDx, are preparing to move into a Meriden building being converted to lab space by private developers.

“The good thing is that TIP doesn’t just kick people out,” Tafas said. “They are not doing that. Actually, they have been very helpful creating relationships, bringing facility owners here from different places. We had an opportunity to map out the territory and see where we could go.”

Leaving the nest

QCDx launched nearly seven years ago, working to develop machines that use lasers and computers to spot rare cancer cells in the bloodstream. Finding these needles in the haystack and analyzing them can help oncologists tailor more effective treatments, Tafas said.

QCDx’s “RareScope” examines cells stained with fluorescent markers to create 3D models without the need for a microscopy slide.

The company is currently engaged in a clinical trial with UConn’s cancer research center, examining the device’s ability to help oncologists determine how breast cancer cells are responding to treatment.

That trial will wrap up later this year and is expected to lead to a study by the U.S. Food and Drug Administration. If all goes well, the goal is to eventually sell the device in the U.S. and Europe.

QCDx is preparing another clinical trial to determine if its technology can diagnose breast cancer early, and another to test the device’s applications for the treatment of glioblastoma multiforme, the most deadly type of brain cancer.

A big part of the reason QCDx was able to get to this point was UConn’s technology incubation center in Farmington, located in the UConn Health Cell and Genome Sciences Building at 400 Farmington Ave., which provided lab and office space, financial advice, access to advanced technology and a bargain rent.

Abhijit Banerjee, UConn associate vice president for research, innovation and entrepreneurship, said five-year limits are common among incubators. It provides enough time for concepts that work to flourish, while making room for new prospects, he said.

“This is a playbook we kind of took from the pharma industry, which is if you have a compound that is developing, the philosophy is ‘fail fast,’ rather than drag it out and spend a lot more money,” Banerjee said. “If it’s not going to make it, you better realize in the next three to five years it’s not going to make it.”

Paul S. Parker, director of the TIP program, said UConn provided six companies with lease extensions so they had enough time to find new homes.

Five of these companies — including QCDx — have negotiated or are close to finalizing leases in a Meriden office building being converted into lab space, Parker said.

UConn has connected departing startups with developers converting 875 Research Parkway in Meriden. The building had been part of a campus used by Protein Sciences Corp. The pharmaceutical company was purchased in 2017 by France-based Sanofi, which announced in July plans to withdraw operations from Connecticut by the end of the year.

QCDx hopes to occupy 3,000 square feet in the building by early next year, about three times its space in the Farmington incubator.

Frank Galluzzo, who co-owns the 50,000-square-foot Research Parkway building in Meriden with Farooque Mesiya, said the city’s economic development director, Joseph Feest, put him in touch with UConn officials. Feest is also helping negotiate a local tax relief deal that will be critical to making the project work, Galluzzo said.

Galluzzo and Mesiya have already gutted the building and begun to design upgrades needed to house four startups leaving UConn’s incubator. They have room for a fifth.

Retrofitting the building for lab space will mean making water available for more sinks and eyewash stations. They will also need to add fume hoods, specialty counters, piping for gasses used in experiments, specialized LED lighting and flooring with antimicrobial properties.

The biggest expense, Galluzzo said, will be a specially designed HVAC system that could cost up to $3 million, he estimated.

Galluzzo said he hasn’t calculated a final price tag for the renovations, but it will likely be three to four times higher than building out a standard office space.

“Literally, the only thing we are keeping is the shell,” Galluzzo said. “The big-ticket item is going to be the HVAC system. It’s super expensive. The unit has to be made, you don’t just pick it off the shelf.”

Banerjee said the increased flow of startup “graduates” out of its facility will encourage developers to build more small lab spaces in the region.

“Had we not done this, we would not have a group of investors and real estate people coming out and thinking about creating incubators,” Banerjee said.

New startup tenants

UConn’s TIP program offers labs ranging from 250 square feet to 680 square feet. Some companies have been allowed to lease additional space, up to about 2,000 square feet. The TIP program has 40 labs and 60 offices, most of which are centered in a roughly 26,000-square-foot space in Farmington. UConn hosts another 4,000 square feet of incubator space in Storrs.

Occupancy generally runs in the mid- to high-90% range, Parker said.

Incubator space leases for $30 per square foot, increasing $2 per square foot every year of occupancy. Tafas said that’s less than half the cost of comparable space elsewhere.

Now, the TIP program has a dozen prospective startups that it’s currently vetting; three of those companies are expected to move into lab space in Farmington this month, Parker said.

Chris Ostop, managing director of brokerage firm JLL in Hartford, said it’s difficult to find suitable small laboratory spaces in the Farmington or Hartford areas, especially compared to New Haven, which has a more evolved biosciences ecosystem.

One major hurdle is finding spaces with advanced HVAC systems required by laboratories, Ostop noted. Those systems can make it prohibitively expensive to create new lab space for lease, he said.

“That space does not exist in Greater Hartford today because it is super expensive to build,” Ostop said. “It could be built tomorrow, but there hasn’t been demand for wet labs. It is possible, but there needs to be a viable (bioscience) ecosystem to support the infrastructure.”