Rochester Commercial Real Estate Development and Investment Summit

screenshot.pngI attended the 2017 Destination Medical Center Real Estate and Investment Summit in Rochester MN.   It was a full day event being hosted at the Mayo Civic Center located on the downtown waterfront of the Zumbro river.   The day would begin with guided walking tours of the new development areas in downtown as well as visit familiar sites around the Mayo buildings and cultural centers of downtown.   This included the Heart of the City,  Discovery Square, Central Station, St. Mary’s Place, and the Downtown Waterfront areas of planned development. The UMR/recreation area was also mentioned on the tour.
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Over twenty speakers would take the stage throughout the day to talk about different aspects of the development activities in Rochester.  The speaker roster included:
Mayor Brede, City of Rochester
Doug Holtan, Mayo Clinic
Rob Miller, Rochester Area Chamber of Commerce
Jon Buggy, RSP Architects
David Vigliotta, Seventhwave
Joe Weis, Weis Builders
Jamie Sundsbak, Collider
Chris Puchalla, Iron Point Partners
Jeanine Gangeness, Winona State University
Nick Pompeian, Realty Growth Incorporated
Kent Roers, Roers Investments
Tom Leimer, Knutson Construction
Lisa Clarke, Destination Medical Center, Economic Development Agency
Richard Freese, City of Rochester
Patrick Seeb, Destination Medical Center, Economic Development Agency
Mac Hamilton, Hamilton Realty Inc
Bob Lux, Alatus LLC
Rick Fenske, Weis Builder
Nate Stencil, Stencil Group
There where many diverse stories of investment, development, and innovations that spanned industry, community, and transportation.   They investments around infrastructure are very future forward in terms of next generation solutions.  The city is also attracting a fair amount of international investment.
The day concluded with a large networking session and then the final ribbon-cutting ceremony of the new expansion of the Mayo Civic Center.   The amount of energy, interest, investment, and mindshare that the community shares was both visible and felt in all the interactions.   The depth and breadth of the vision into the future also sets a high bar for other city planners.   My steps involve a number of follow-on meetings in Rochester that will explore the best practices around building economic engines around innovation, education, and exchange that can amplify the great progress already underway.
More pictures in the event gallery

 

Canada’s Innovation Budget / Superclusters

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Canadian Prime Minister Justin Trudeau announced the 2017 budget included an Innovation and Skills Plan.   This is a bold and visionary plan for the development of the country.   It is driven by concerns for the stability of the USA as a long-term trading partner and focuses on building the necessary assets required to be a leading country in tomorrow’s global innovation economy.   The future state plan is multi-faceted targeting major investments in the development of their ecosystem around six superclusters and emerging industries.   It also incorporates the building of new education offerings around lifelong learning for both the current workforce and next generation of students and workers.  While many regions around the world are working on their regional cluster strategies,  this marks a leading trend of county-wide strategies targeting the development and integration of cross-region assets into superclusters.
Here is a quick summary of the budget announcement.
Proposed industry efforts include:
  • $950 million CAD ($709.8 million USD) over five years to develop superclusters in six key national industries:
  1. advanced manufacturing
  2. agri-food
  3. cleantech
  4. digital industries
  5. health/bio-sciences
  6. clean resource
    (+ 7. emerging AI cluster)
  • $50 million CAD ($37.4 million USD) to launch Innovative Solutions Canada.  This is a government procurement program modeled after the United States’ Small Business Innovation Research (SBIR) program.
  • $400 million CAD ($298.9 million USD) over three years to help drive investment in growth-stage companies. Through the Venture Capital Catalyst Initiative (VCCI), the Business Development Bank of Canada would make late stage venture capital deals with the intent of stimulating co-investment from the private sector.  The government hopes to unlock nearly $1.5 billion CAD ($1.1 billion USD) in private sector investments through these efforts.
Proposed education and research efforts include:
  • $3.1 billion CAD ($2.3 billion USD) for research and research training – e.g., scholarships, fellowships, research grants, and support for the overhead costs associated with federally funded research conducted in post-secondary institutions.
  • $741 million CAD ($553.3 billion USD) for investments to accelerate infrastructure projects at universities and colleges and affiliated institutions through the Post-Secondary Institutions Strategic Investment Fund.
  • $340 million CAD ($253.9 million USD) in planned support for equipment and facilities for post-secondary institutions, research hospitals, and other not-for-profit institutions.
  • $158 million CAD ($118 million USD) for several of the country’s public-private partnerships such as Mitacs, Genome Canada, the Canadian Institute for Advanced Research, the Stem Cell Network, the Institute for Quantum Computing, Brain Canada and the Perimeter Institute for Theoretical Physics.
Proposed Workforce efforts include:
  • $454.4 million CAD ($339.3 million USD) over four years, starting in 2018–19, and $46.3 million CAD ($34.6 million USD) per year thereafter, to help Canada’s middle-class workers find and keep good jobs.
  • $225 million CAD ($168 million USD) over four years, starting in 2018–19, and $75 million CAD ($65 million USD) per year thereafter, to establish a new organization to support skills development and measurement in Canada.
  • $221 million CAD ($165 million USD) over five years to fund up to 10,000 work-integrated learning placements for post-secondary students and graduates each year.
  • $186 million CAD ($138.9 million USD) would be provided to support other, unspecified research and development and related scientific activities in the higher education sector.
  • $7.8 million over two years to implement a new visa program that would allow certain skilled workers to obtain a work permit.
  • $50 million CAD ($37.4 million USD) for a new initiative – Coding Kids. The new two-year initiative would help teach Canadian children how to code to help prepare them for future IT-related careers.

 

See images of the announcement in the international gallery

Stay tuned to follow the progress of this initiative and more to come on cluster development and supercluster integration.

 

2017 CornerHouse Breakfast / Fundraiser

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I attended CornerHouse breakfast as a part of their 4th annual fundraiser in support of abused children and their families.
The event was well attended with ~300 guests of the non-profit.   The event started with open networking as guests arrived followed by a sit-down breakfast as the keynote began.   I’ve attached the event agenda to this post to highlight the fantastic speakers that presented.  The subject of child abuse is quite a difficult topic.  Several facts were quite shocking including that only 20% of abuse cases are reported and it is mainly by someone the child knows.   Our speakers were very generous to share their stories of working in this field and specific cases they had involvement in.   It was a tough and emotional hour for everyone.  I really have to give credit to the presenters who had to struggle through some pretty personal emotions at the podium for the sake of the cause.   At the conclusion of the fundraiser, I had the chance to get introduced to many people at the CornerHouse organization.   What a great team that is supporting and extremely important cause.
Learn more and get involved: CornerHouse
More images at the Cheval gallery
Event Agenda:
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Beginning Cluster Development

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I participated in the economic development roundtable webinar focused on Cluster development.   Guest speakers were from Cluster Navigators.  The conversation was exploring how to get cluster development programs underway in your local area.  The speakers have published a 12 step handbook and process image of the journey.  This interactive session allowed a great Q&A dialogue across a wide number of economic development attendees.
Check out Cluster Navigators:  https://www.clusternavigators.com
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Photo Galleries:

Summary: International Conversations In Innovation

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The past year involved a great number of international conversations they were exploring investment and practices in innovation centers in the United States with the goal to integrate them to centers back in the country of investment origin.  Much of the drivers were to build a sustainable bridge of industry collaboration around innovation between the two countries and to integrate education offerings to develop new workforce skill sets.
Here is a quick list of international discussions covered in prior blogs:
Photo Galleries:
Explore the blog further to see national discussions across US cities and Government

Economist / Future Work Event Chicago

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I enjoyed listening to the high-level panel discuss at the kickoff of The Economist Future Works,  Jobs in the fourth industrial revolution in Chicago.   The panel was a facilitated discussion the needs and challenges around meeting current and future workforce needs.
Here are some quick notes from the discussion:
  • Diversity is not just demographics.   It is also about decision making and the need to have diversity in decision making.
  • What new leaders need:  More analytical,  more tech savvy,  mindfulness, more empathetic ( most important skill)
  • Professions will be disruptive over time.
  • Machine processes are different than human processes  though the processes can intersect / overlap in some areas
  • 4th industrial revolution:
    • earlier revolutions focused on simple blue collar tasks
    • this is a knowledge revolution
  • Have to reinvent learning at every level throughout people’s lives / careers
  • We will have over 2B children entering the global workforce
  • Entrepreneurial mindset; Comfortable with risk,  creative mindset
  • Have to start teaching people how to create their own jobs
  • Current academic models are not working
    • We have not evolved our content we are teaching
    • We are mass educating people instead of optimizing people
    • Change the teacher role from lecture to coach and the sooner the better
    • The teaching methodologies are completely out of date
    • Overhaul how we train teachers
    • Need better global standards and measurement
    • Students make fear based decisions about career vs. aligning with their strengths
  • Role of digital platforms in education will be critical on a global level
There was some Q&A in the session.   One key area was around the funding to change.   Today most public institutions are struggling with declining funding and yet need to change.  Funding for existing models, that are failing, will have to change so that money can be put into new areas.
I have been involved in this conversation for several years now with cities in the USA and globally.   In my next blog, I will introduce some additional factors involved in this space beyond what was discussed today.  (now posted) Building a Global Workforce
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1st Investor Conversation with Reps from E. Europe / Middle East / Africa

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Our Economic Development Team connected with another group representing investment groups spanning Saudi Arabia, Turkey, and Eygpt.
Currently, the conversation is in the exploration stage but interest seems high around innovation services.  Particularly the ability to build out start-up incubation services in key areas of technology critical for these regions.   These services would be used to support US based start-ups and the exchange of international based startups to incubate in the USA all with goals of having commercial potential to solve challenges in their regions.    Most of these technologies around water, energy, agriculture, etc would have applicability around the world so are high priority efforts for many investment groups.
What has been interesting over these past few months of hosting international delegations is not only the similarity of interests in innovation, education, and exchange,  but the vast diversity of how they view investments in different cities in the USA.   Some of the factors that seem to create the variance is determined by:
  1. Where they see the strength, growth/decline,  or emergence of industry clusters in the USA.   Cities with old brands are not attractive and cities with significant international brand and clear economic development plans for the region attract attention.  Note:  This is not always the biggest US cities that have the best plan forward and those plans are not always lead by government agencies but more private economic development companies working collaboratively across the region.
  2. Demographics of the overall region.  How international is the area?
  3. Education opportunities,  what international programs exist or willingness to develop.
  4. Current USA industries working in their region
  5. Current regional government engagement with the international region.   This is more state level vs. federal.  How proactive is has the state been to do outreach and build relationships.
  6. The vibrancy of the startup economy:  The amount of investment corporations or Venture Capitalists had made in their local region.
  7. The personal networks of the investors in partnership with other USA investors.
  8. Willingness to partner in foreign the capital stack between domestic and international money.en
  9. Vetting and background checks of all parties.
  10. Personal networks / history of past business success.
Our next step is to partner with the US Commercial Services to vet these opportunities / sources at this time.