Universities must tackle the disadvantages of innovation districts

Over the past two and a half decades, partnerships between universities and venture capitalists have transformed many urban areas into powerful innovation districts. These bright areas have spawned tech start-ups, attracted high-paying jobs, and developed biotech giants. Yet for all of their many benefits, universities need to seriously think about how they are transforming the neighborhoods they call home.

Kendall Square in Boston, Technology Square in Atlanta, University City in Philadelphia, and Aggie Square in Sacramento are just a few examples of these university-anchored innovation districts, co-created with the Massachusetts Institute of Technology, the Georgia Institute of Technology. , Drexel University and University of California, Davis, respectively. Even regional comprehensive universities in mid-sized cities have adopted similar strategies.

The aftermath of the 2008 financial crisis highlighted many concerns about the inner workings of colleges and universities, with elected officials, the media and the public criticizing what they saw as self-centered institutions. A push for greater relevance by realigning higher education practices with broader social goals has forced universities to become more entrepreneurial, which has helped strengthen many existing initiatives while leading to the creation of many new ones. companies.

The innovation districts have already contributed to the fight against the global pandemic through research on vaccines and other health needs. Consider that Pfizer operates a cutting-edge, biotech-focused R&D hub with 1,000 employees in Kendall Square. (In fact, the laboratory facilities at the site are leased from MIT.) Moderna’s global headquarters are also located there.

In Atlanta, Tech Square has experienced significant expansion over the past decade, resulting in increased diversification of activities. Georgia Tech has been successful in attracting companies to locate their innovation labs in the region. AT&T, Boeing, Coca-Cola, Deloitte, Delta and Home Depot are some of the companies that are now present there.

After making some adjustments, Innovation Districts should successfully overcome many of the current challenges associated with Covid-19. Yet, due to the increase in remote and hybrid employment options, post-pandemic conditions may lead to further diversification of the office real estate market, with existing commercial space being subdivided to incorporate retail and even residential use. This could allow previously high-priced entrepreneurs to operate there and, in so doing, help to increase the residential population of the city center.

It’s also worth mentioning that the Tax Cuts and Jobs Act of 2017 led to the creation of 8,700 “opportunity zones” across the United States, with tax incentives to help fund initiatives in struggling communities. with decline and divestment. The aim is to encourage job-creating activities by supporting small businesses.

Such areas of opportunity have been designated near the centers of higher education and research in each state. Indeed, some campuses are themselves in areas of opportunity. Some universities are already in partnership with investors, and developers are exploring projects that could benefit from this legislation. A qualified opportunity fund eases the process by allowing investors to participate while deferring capital gains. Since universities are anchor points for the commercialization of knowledge, they can seize the opportunity to create incubators and accelerators to support student start-ups and other entrepreneurial activities.

Yet we need to be aware of the unintended consequences that innovation districts can have. There is no doubt that they exert considerable pressure on low- and middle-income families, often resulting in greater social inequality. They certainly attract new residents with high incomes and education who are creative, ambitious and enterprising. This triggers infrastructure investments in housing and retail services, helping to regenerate once-struggling areas. But such developments can also lead to considerable gentrification and displacement, often with particular impact on minority communities.

It is essential that universities are aware of this and work closely with local government and other organizations to manage the consequences. Strategies to ensure that existing residents can benefit from the development of innovation neighborhoods include community engagement and collaborative partnerships; investing in affordable housing and primary / secondary education; and the provision of recycling opportunities. In this way, universities can help improve rather than disrupt the life of their immediate neighborhoods.

After WWII, many urban colleges and universities erected walls, using physical boundaries and strategically constructing facilities to isolate themselves and protect themselves from the socio-economic challenges of their surroundings. This produced a form of separation for which they have been rightly criticized.

Today there is a danger that new technology clusters lead to equally undesirable results. Creating monolithic cultural settings with largely high-income residents can easily fuel separation and isolation, erecting a sort of invisible wall and once again keeping the university separate from the realities of the city.

It is therefore crucial that universities and their affiliates actively seek to balance the “innovation bubble” effect with community wellness initiatives.

Costas Spirou is dean and vice-president of academic affairs at Georgia College, the state’s public liberal arts university. He is also the author of Anchoring innovation districts: the entrepreneurial university and urban change (2021).


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