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Business Manager’s Blog

Michael Monahan

Michael P. Monahan, the Business Manager of Local 103 of the International Brotherhood of Electrical Workers, represents more than 7,000 electrical and telecommunication members in the Greater Boston area.

In addition to the strong and steady leadership he provides to his Local Union on a daily basis, he exudes the same qualities when providing services for the community, whether it is coordinating volunteer efforts for electricians who are donating their skills at various places, such as schools and private homes for disabled individuals, or the installation of wireless capabilities for the City. From his days as a rank-and-file member through his current position as Business Manager, Mike has met every challenge and serves his membership with pride and distinction.

Developers Focus On Outdoor Perks

Banker & Tradesman | By Steve Adams
August 31, 2014

Schraft CenterCafés atop the Schrafft Center in Charlestown. Rooftop bars overlooking Boston City Hall Plaza. A name-brand restaurant at the massive Cross Point office complex in Lowell.

Owners of high-profile commercial properties are moving forward with plans to contemporize iconic structures, part of a strategy to attract tenants to fill large blocks of vacant offices. But it’s their emphasis on maximizing outdoor spaces and common areas that are central to creating a new image for these regional landmarks.

With Schrafft Center anchor tenant Partners HealthCare scheduled to decamp to Somerville’s Assembly Row in 2016, longtime landlord Flatley Co. of Braintree will be looking to fill nearly half of the 609,000-square-foot building. Despite its location on the Mystic River, the property has little connection to the waterfront three decades after it was converted from chocolate factory to offices. A large parking lot occupies much of the space between the building and the river.

Boston-based CBT Architects is writing the next chapter in the history of the 16-acre property. A master plan that would create a campus environment, with new links to the riverfront and Sullivan Square.

Also under consideration: rooftop restaurants that would maximize Boston skyline and harbor views.

“To be able to use that space would be unbelievable,” said Haril Pandya, a CBT principal.

From Boston’s Financial District to the Route 495 belt, commercial landlords are putting a premium on upgrading open-air and common-area amenities. They see them as key to recruiting tech companies whose Millennial workforces favor non-traditional workspaces.

Mathworks’ new campus in Natick has an outdoor kitchen equipped with barbecue grills, refrigerators and seating for 800 employees. In the Alewife section of Cambridge, Equity Office Properties added a bocce court and fire pit last year at Intuit division Quickbase’s new offices at 150 Cambridgepark Drive.

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Report: Greater Boston trails only Silicon Valley in tech employment

Boston Business Journal | By David Harris
August 29, 2014

AOL at Burnham BuildingThe Greater Boston area ranks second in the nation in tech employment and fourth in tech-related venture capital funding among major U.S. markets, according to a report released Friday from commercial real estate firm Jones Lang Lasalle.

According to the firm’s annual technology outlook report, Boston with its more than 145,000 tech jobs trails only Silicon Valley in terms of total high-tech employment, noting that Greater Boston experienced a 4.3 percent growth in high-tech jobs over the year. Silicon Valley had year-over-year tech-related job growth of 5.2 percent and employed a little over 213,000 people in the industry, the report noted. But the results aren’t much of a change from last year’s report, which stated that the Boston area was No. 2 in terms of tech jobs and No. 4 in venture funding.

The Boston area also scored big in venture funding during the second quarter of this year, accumulating a total of $441.6 million in funding during the time period, according to the report. San Francisco, Silicon Valley and Manhattan all snagged more venture capital funding than the Boston area.

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Baxter’s hunt for space in Cambridge triggers a counter effort in Illinois

Boston Business Journal | By Craig Douglas
August 29, 2014

Alexandria CenterEconomic development officials in Illinois are planning to engage Baxter International and lobby for the biotechnology giant to keep its core operations outside of Chicago, a move that could complicate the company’s ongoing hunt for big blocks of space in Cambridge’s Kendall Square.

According to a report by Crain’s Chicago, the Illinois Department of Commerce and Economic Opportunity said it plans to resume recent discussions with Baxter (NYSE: BAX) about its plans for the future. The news came a day after an Aug. 27 story by the Boston Business Journal about Baxter’s ongoing hunt for as much as 400,000 square feet of office and laboratory space in Cambridge.

Crain’s reported that Illinois officials have not held formal talks with Baxter about its local operations since March, when the company first announced plans to split into two separate businesses — one focused on the research and development of biotechnologies and the other specializing in the distribution and sale of medical products. The company’s status has prompted discussions over whether Illinois will dangle tax incentives to retain as many of Baxter’s 5,400 local employees as possible. The company is formally headquartered in Deerfield, Ill.

“We agreed (in March) to resume the discussions in a few months and are now doing so,” said David Roeder, an Illinois state spokesman, in an email exchange published by Crain’s. “We will work to keep their employees in Illinois.”

The BBJ first reported on Baxter’s secretive search for space in May. At the time, the company’s identity was being closely guarded by state economic officials as well as local industry groups who were assisting in the hunt, code named “Project Tiger.” At the time, little was known about the deal aside from some basics about the company, namely that it was a publicly traded biotech and that it was working with a relocation specialist from the MidWest and the local brokerage team at Transwestern|RBJ to vet potential homes in Cambridge.

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At Boston’s biggest downtown towers, landlords still prove they can hustle

Boston Business Journal | By Craig Douglas
August 29, 2014

Hancock TowerSo much attention is paid to Cambridge’s Kendall Square and the Seaport these days that it’s easy to lose sight of the fact that most of the region’s most prominent — dare we say most important? — properties are still packed into the Financial District and Back Bay. And while the headlines might suggest these behemoths are being emptied faster than Arthur T. Demoulas’ bank account, it’s just not the case.

A Boston Business Journal analysis of some of the largest towers in the city shows that many are enjoying their highest occupancy rates in years, although the good times haven’t come easy. Financial filings indicate these landlords have been working on overdrive to keep their properties filled, with many having to thread some impressive needles in order to head off or counter major lease expirations before they bite. Here’s a status update, based on recent loan-servicer filings, on some of the biggest office properties in Boston’s downtown market:

  • One Financial Center: Located across the street from South Station, One Financial Center reported an occupancy rate of 90 percent at the end of 2013, versus 84 percent in the year-earlier period. The improved occupancy is attributable to a flurry of deals that closed in recent months that helped the property’s owner, a partnership involving an affiliate of MetLife and Norges Bank Investment Management, Norway’s sovereign wealth fund, blunt a flurry of lease expirations that threatened to empty about 50 percent of its 1.1 million square feet of office space. In December, the law firm of Mintz, Levin, Cohn, Ferris renewed a lease for some 200,000 square feet of space through 2019. Around that same time, MetLife re-upped its contract for about half of its previous layout of 170,000 square feet. Meanwhile, existing tenant Loomis Sayles & Co. gobbled up three floors that were emptied by MetLife. According to financial filings, the building generated about $54 million in lease revenue last year.
  • One Federal St.: The 1.1 million-square-foot property was 84 percent leased as of March 31, versus 66 percent at the end of 2012. Owned by an affiliate of Tishman Speyer, the building saw significant vacancies after the downturn when big tenants such as Bank of America and State Street announced they were leaving. Recent deals involving the law firm Bingham McCutchen and insurer Homesite Group Inc. have accounted for around 30 percent of the building’s leasable space. A recent note by Wells Fargo, the property’s mortgage servicer, indicates that another 185,000 square feet of space is under agreement with two separate 10-year deals with tenants.

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Construction hiring in Massachusetts up 3 percent for July

Boston Business Journal | By Craig Douglas
August 27, 2014

Construction toolsMassachusetts added 3,600 construction jobs in the 12-month period that ended July 31, a 3 percent increase that was led by a handful of the state’s smaller markets outside of Boston and Suffolk County.

According to the Associated General Contractors of America, a lobbying group outside of Washington, D.C., 11 of the 12 Massachusetts metros it tracks added jobs in July, with the lone outlier being Pittsfield, which was flat. The commonwealth’s gains corresponded with an expansion throughout the U.S., as AGC said 223 of the 339 markets it tracks added jobs in the year-over-year period that ended in July. Another 72 markets were flat, while 44 reported job losses during the 12-month span.

In Massachusetts, the Leominster-Fitchburg-Gardner metro was the fastest gainer in July, as employers expanded their workforce by 16 percent, or 300 positions. New Bedford ranked second at 15 percent growth.

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LED lighting company Lumenpulse to triple headcount to 75 in Boston

Boston Business Journal | By Sara Castellanos
August 27, 2014

Greg CampbellLED lighting firm Lumenpulse Inc. expects to grow its Boston headcount to 75 within five years, up from 25 currently, and plans to move to a larger space in the city within a year, according to the company’s CTO.

The Canadian company has been growing swiftly since it made its first acquisition last month and ramped up product development and sales and marketing efforts in 2010 in Boston, where it decided to locate its U.S. headquarters.

Boston is home to Lumenpulse’s engineering, design and innovation team and also its inside sales, customer service and technical sales support team, said the company’s senior vice president and chief technology officer Greg Campbell.

The company is currently operating out of about 6,600 square feet of space in an office in the Fort Point neighborhood of Boston and is looking for a new office in Boston that’s double the square footage. Plans are for the company to move into a new office within the next year, Campbell said.

Lumenpulse is publicly traded on the Toronto Stock Exchange (TSX: LMP) and its 2014 revenue was $62.2 million for the fiscal year ending on April 30.

While Campbell did not disclose revenue estimates for 2015, he said the company expects to “outgrow the market year-over-year.” The LED market’s revenue has been growing at a clip of about 30 percent annually, he said, and Lumenpulse expects to exceed that percentage.

In July, the company closed its first acquisition — of United Kingdom-based Projection Lighting Ltd., a LED lighting manufacturer for retail, display and architectural applications. The cost of the acquisition was $30.4 million and was paid in cash.

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Outside the Box: Bill White of Massachusetts Clean Energy Center

Boston Business Journal | By Jay Fitzgerald
August 29, 2014

Bill WhiteBill White

Age: 49

Title: Senior director, offshore wind sector development, Massachusetts Clean Energy Center

Education: Bachelor’s of science degree, management, Boston College, 1987; master’s degree, public administration, Harvard University’s John F. Kennedy School of Government, 2003.

Residence: Milton

Bill White is certain about one thing: The New Bedford Marine Commerce Terminal now under construction will be ready for use as a staging area for the historic Cape Wind offshore wind-farm project.

As senior director of offshore wind-sector development at the Massachusetts Clean Energy Center, White is tasked with overseeing the construction of the $100 million facility that Cape Wind Associates could one day soon be using as a launch pad for a $2.6 billion wind farm off the coast of Cape Cod. (Cape Wind’s arrival in New Bedford is not a sure thing; it also has a lease agreement for North Kingstown, R.I.)

If all goes well, the 28-acre New Bedford Marine Commerce Terminal should be completed by the end of this year, in time for preliminary construction of the wind farm in 2015.

A former assistant secretary for federal affairs within Gov. Deval Patrick’s executive office of energy and the environment, White has also served as a special assistant to former President Bill Clinton in Washington, D.C., and worked a number of years at the U.S. State Department. He once served as a media liaison dispatched to Kuwait a day after the Gulf War ended in 1991. He’s also been a “slow but steady runner” over the years, participating in four marathons in Boston, New York, Washington and Chicago.

He recently spoke about his personal and professional life with BBJ correspondent Jay Fitzgerald.

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After missteps, Dunkin’ Donuts set for California expansion

Chastened by early mistakes, company takes a 2d shot in the state Starbucks rules

The Boston Globe | By Taryn Luna
August 26, 2014

Dunkin Donuts CaliDunkin’ Donuts, the coffee chain so familiar in the Northeast, is nearing the end of an expansion march across the country to become a true national brand.

The retailer will kick off its California expansion on Tuesday, the first step in a strategy to challenge Starbucks’ stronghold on the West Coast.

The company once operated more than a dozen restaurants in the state but shuttered them by the early 2000s, citing logistical problems and poor relationships with franchisee partners.

Dunkin’ temporarily abandoned its California dreams as the international business grew to more than 3,000 restaurants. Today the chain serves its signature Munchkins and Coolattas at nearly 900 stores in South Korea, but has only three nontraditional stores in obscure California locations: on a Marine base, inside a hotel, and at a highway rest stop.

Now the coffee chain is preparing to take another shot in a market where its toughest competitor, Starbucks Corp., dominates with more than 2,500 stores.

Dunkin’ plans to open its first traditional restaurant in Modesto, Calif., on Tuesday and a second store in Santa Monica in the following weeks.

Three additional restaurants in Long Beach, Downey, and Whittier are expected before the end of the year. Franchisees have signed agreements to open nearly 200 stores by 2020 and the company intends to eventually grow to 1,000 stores in the state.

“We’ve learned a lot about operating out West,” said Nigel Travis, chief executive of Dunkin’ Brands. “We’ve been incredibly impressed with the quality of the franchisees.”

But Dunkin’ had to learn the hard way.

The chain was so eager to enter California in the 1990s that it “hopscotched a lot of the country,” said Grant Benson, vice president of global franchising and business development at Dunkin’ Brands.

The nearest distribution center was in Chicago, and truck drivers hauled products thousands of miles to the California stores. “It left a lot of gaps where we didn’t have a supply chain and any development,” Benson said.

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The Giant What-If Surrounding the Nashua Street Residences

Curbed Boston | By Tom Acitelli
August 26, 2014

TD GardenIt’s one of the tallest new residential developments in all of Boston and a prime example of a major trend driving the city’s real estate right now. Nashua Street Residences, the gargantuan (for Boston, at least) 415-foot tower behind TD Garden, broke ground earlier this month after years of on-again, off-again planning. It begins life as apartments: To be precise, the Nashua Street Residences at 121 Nashua Street is slated to include 38 floors of 503 studio, 1-BR, 2-BR and 3-BR apartments as well as amenities (including bicycle storage—for wait for it—503 bikes). Tucked into its descriptive documents with the city, however, is one telling caveat.

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James Hook & Co. lines up development

Seafood co. site could be hotel or housing

Boston Herald | By Donna Goodison
August 26, 2014

Seafood Co.A developer representing James Hook & Co. is expected to present plans this fall to convert the Boston seafood retailer/wholesaler’s site — a key underdeveloped waterfront parcel — into new residences or a hotel, according to sources familiar with the proposed project.

SKW Partners is expected to unveil the plans, including options for Boston Harborwalk connections, to the Downtown Waterfront Municipal Harbor Planning Advisory Committee at the end of September or in mid-October.

“The city has strongly encouraged them to stay within the (Rose Kennedy Greeenway) guidelines for height (of 175 feet),” said one source. “They’re a bit over 200 feet.”

A third generation of the Hook family manages the business, which got its start in 1925. Its current Atlantic Avenue operations — a retail seafood store with a limited lunch menu that includes lobster rolls — is housed in a small one-story structure after a 2008 fire virtually gutted the approximately 20,000-square-foot site between the old Northern Avenue and Evelyn Moakley bridges. The Hooks, who plan to maintain an expanded presence in the new development, did not return calls.

SKW Partners principal William Zielinski also could not be reached.

The Boston Redevelopment Authority acknowledged preliminary conversations about the site with James Hook representatives. “Any redevelopment proposal would be guided by the municipal harbor planning process, and Hook’s representatives have expressed an interest in presenting to the (Downtown Waterfront) Municipal Harbor Plan(ning) Advisory Committee in the fall,” spokesman Nick Martin said.

The Downtown Waterfront Municipal Harbor Plan will dictate waterfront zoning. If the city submits the plan to the state by early next year, it would be approved no sooner than next summer, according to Vivien Li, president of the Boston Harbor Association and acting chairwoman of the Municipal Harbor Planning Committee. That would mean any construction at the James Hook site likely would not begin before spring 2016 at the earliest, given the city and state permits needed, Li said.

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Mass. subcontractors get some help with new construction law

Boston Business Journal | By Mary Moore
August 25, 2014

Gregory VasilThe construction industry is in turmoil over a sweeping new law pushed by subcontractors that, at its core, provides subs with favorable treatment when it comes to the timing of their payments from owners and developers.

Among the most contentious parts of the new law, which has angered some members of the developer community, is the reduced amount of money owners and developers can withhold from the subs who are working on their building projects through a practice known as “retainage.” Developers have long argued that withholding money from subs gives them leverage toward the end of a project if problems arise and subs are needed to return to the job and do additional work.

Subcontractors argue that they need more cash in hand to buy material and to keep their businesses running.

The Associated Subcontractors of Massachusetts was the driving force behind the legislation, which Gov. Deval Patrick signed into law on Aug. 8. Monica Lawton, CEO of the trade group, disagreed with developers’ assertions that they need the extra retainage funds to maintain leverage over subcontractors.

“They live by their reputations,” Lawton said of subcontractors. “Because they’re not going to get another project with a general contractor if they have a reputation of walking out on a job and not coming back.”

The measure, which establishes a definitive process and timing for payments to subcontractors and for the close-out of construction projects, applies to projects valued at $3 million and higher. Starting in early November when its provisions go into effect, the new law limits the amount a developer can withhold to 5 percent of a subcontractor’s contract. The current industry standard is for developers to withhold 10 percent of the contract.

Subcontractors argue that having 10 percent withheld not only is too much, the money typically is held for too long – sometimes months after a construction job concludes. The new law, to that end, also requires that payment of the withheld funds to come no later than 30 days after the “substantial completion” of a subcontractor’s work.

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Lighting company Osram Sylvania will move HQ from Danvers to Wilmington

Boston Business Journal | By Sara Castellanos
August 22, 2014

LightLighting company Osram Sylvania will move its regional headquarters from Danvers to Wilmington next summer.

The company’s current headquarters are at 100 Endicott St. in Danvers, where the company is working out of 155,000 square feet. The new regional headquarters will be 125,000 square feet at 200 Ballardvale St. in Wilmington.

The new location will “present enormous opportunity for the lighting leader to design the positive changes required to support the needs of the business within the transforming lighting industry,” according to the company.

“This move is essential to building a more agile and collaborative culture, which will help us operate with speed, deliver innovative products that customers love, and generate future growth,” said Jes Munk Hansen, president and CEO of Osram Sylvania, in a statement. “All of that will help us achieve our ultimate measure of success: maintaining and expanding our industry leadership in an increasingly competitive and rapidly changing environment.”

The company, which offers various energy-saving lighting products, systems and services for homes, businesses, institutions, automobiles and other markets, employs 675 in Massachusetts and is hiring.

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Downtown Crossing has become desirable

The Boston Globe | By Vanessa Parks
August 24, 2014

Dowtown CrossingAfter years of effort, it looks like it’s really going to happen this time: Downtown Crossing will be revitalized as a center of commerce, yes, but also as a desirable place to live. Construction of Millennium Tower, a 60-story glass structure with 442 residences, is underway at the area’s most prominent intersection. And next door, in the beautiful 1912 Burnham Building that once housed the original Filene’s, work is underway on a Roche Bros. supermarket.

Both should go a long way toward infusing life into Downtown Crossing. Though it is flooded with people on weekdays, the area typically is quiet at night and on weekends. But once the tower is occupied, more people will be out and about, drawing others in.

Having a supermarket in the area goes a long way toward creating what Craig Caplan calls “a real neighborhood.” Caplan runs The Unique Boutique and leases out other pushcarts to vendors.

“Residents bring so much to the table: as eyes on the street monitoring what’s happening, as a new voice and perspective within downtown’s community of stakeholders, and as people who have made a literal investment in the neighborhood,’’ said Rosemarie Sansone, president of the Downtown Boston Business Improvement District .

“Right now, it’s still very much in transition,’’ said Caplan, who’s also the creator of “The REAL Downtown Crossing” Facebook page.

But the change so many have worked so long for is definitely happening. Caplan said workers are staying later and business is bustling at cafes, bars, and restaurants.

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Downtown Crossing’s Eye On The Street

Banker & Tradesman | By Steve Adams
August 24, 2014

Rosemarie SansoneRosemarie Sansone

Title: President, Downtown Boston Business Improvement District
Age: 69
Experience: Over three decades

The Downtown Business Improvement District does the dirty work of sprucing up Boston’s fast-changing downtown: removing graffiti, cleaning up cigarette butts, removing trash and providing security and directions for visitors to a 34-block area spanning 100 acres. The organization has an annual budget of $5 million, paid by assessments on properties within the district.

Q: How did the recession affect the preparation of the Business Improvement District?
A: When the financial crisis happened, we asked ourselves: do people really want to continue creating this organization? And the answer resoundingly was yes. We wanted to continue with the work that had begun. It took two-and-a-half years to create the BID but it was about having conversations with as many people as possible. There are 350 property owners representing over 600 parcels

Q: What were the needs that stood out when you were creating the BID?
A: We looked at best practices across the country. There were consistent themes of clean and safe and welcoming. We had identified the 40 top assessment property owners in the district to make sure the people who were going to spend the most money were involved. It was very important to reach out to the towers such as 101 Arch St., 1 Boston Place, the Bank of Boston building, and Equity Office Properties. We also wanted the smaller properties to think that the towers would have a say over everything. So we created a steering committee that represented everyone.

Q: How were the boundaries decided?
A: We looked at how people come in and out of the district and lines that made sense. Tremont Street seemed like a natural boundary. There had been a discussion to include Chinatown. At that time, folks said they wanted to wait and see although I can honestly tell you they’re sorry they didn’t join us, because they can see the difference.

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Rx For Growth

Life Sciences Drive Campus Expansions

Banker & Tradesman | By Erin Baldassari
August 24, 2014

Integrated Science CenterNext month, the University of Massachusetts-Boston will cut the ribbon on a new $182-million Integrated Sciences Complex, while Boston University stands before the Boston Redevelopment Authority to ask for permission to build a life sciences center of its own.

Not all of Boston’s 28 colleges and universities are expanding their footprint, but where they are, it’s life science programs that are usually driving their growth.

Institutional heavyweights like Harvard and the Massachusetts Institute of Technology helped keep the construction industry afloat during the recession, said Massachusetts Building Trades President Francis Callahan. Now, smaller schools like the Wentworth Institute of Technology and Bunker Hill Community College are putting cranes in the air.

“We call them the ‘eds and meds.’ That’s our auto industry in Massachusetts,” Callahan said. “There’s growth in all sectors now.”

Wentworth Institute of Technology will open a 305-bed residence hall this fall, said David Wahlstrom, the institute’s vice president of business. The new building follows a 19,000-square-foot expansion of the school’s Center for Sciences and Biomedical Engineering, which was constructed in tandem with a 48,000-square-foot renovation of its campus center.

The renovation includes a new $3-million manufacturing center where students can practice machining with 3-D printers, automated drill presses and lathes. Although the recession put a damper on construction, Wahlstrom said enrollment stayed strong. The institute introduced new engineering programs, including electrical, mechanical, and biomedical engineering.

“From Wentworth’s perspective, we’re responding to the marketplace,” Wahlstrom said. “Our education is applied. It’s hands-on. So, students are learning in the labs, as well as in the classroom.”

As the biotech and pharmaceutical industries change, so must the institutional spaces where skilled workers are trained, said Boston University senior vice president of operations Gary Nicksa. That is one of the driving forces behind the university’s proposal to build a 145,000-square-foot Center for Integrated Life Sciences and Engineering at 610 Commonwealth Ave. The $100-million project would bring together multiple disciplines under one roof, hosting the type of collaborative research projects students would expect to find in the field.

“There’s a need for replacement space for our laboratories that are coming to an end of their normal life cycles, and it’s also an opportunity to design them in a different way,” Nicksa said. “We’re really developing areas of research where we’re bringing together engineers and life scientists, and we need a different kind of research space that can bring those disciplines together.”

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