The bright orange hoarding around a corner of the downtown MaRS centre reads: "Ideas to Reality." But the idea in this case - the high-tech office cluster's planned $300-million high-rise expansion - has run into the reality of the global economic slowdown, as the project has been put on hold.
While cranes and a handful of workers were still on the site at University Avenue and College Street this week, MaRS's private partner, California-based Alexandria Real Estate Equities Inc., has stopped construction for now, leaving a few low concrete walls topped with rebar, reminiscent of the "stump" that sat for a decade after the aborted Bay-Adelaide Centre became a victim of the recessionary 1990s.
MaRS officials insist the delay is temporary and they could still see their addition completed in 2010. But it isn't the only bad news circulating in the rest of the gleaming complex, built in and around the old brick Toronto General Hospital in 2005 with $95-million in government money and $145-million in private cash. Now, some of the nascent biotech and information technology companies it caters to - dependent on venture capital - are also acutely feeling the economic downturn's pinch.
"We're getting killed," said Tony Cruz, chief executive officer of MaRS tenant Transition Therapeutics Inc., referring to his firm's stock price on the Toronto Stock Exchange and the Nasdaq. "Everybody's getting killed. Everything is down to the lowest levels you could ever think of. ... There is just a lack of cash."
Mr. Cruz says his more well-established firm, which has partnerships with big companies as it tests new treatments for diabetes and Alzheimer's, is in good financial shape until at least 2010. But he acknowledges that new biotech startups will have immense trouble finding investors.
So will MaRS see some or many of its roughly 70 tenants close up shop, making its soaring atrium feel like the middle of a half-empty recession-era shopping mall?
MaRS officials insist that, despite the downturn, there is still a waiting list for startups to get into the centre's subsidized lab space in its high-tech "incubator," and that its other tenants paying market-rate leases - among them the Royal Bank and GlaxoSmithKline Inc. - show no signs of leaving.
Ross Wallace, MaRS's director of strategic partnerships, said in an interview that in an economic downturn, MaRS's mission - to help academics and entrepreneurs turn their high-tech ideas into marketable, profitable companies, and to foster collaboration - becomes even more crucial as similar centres (but with billions in funding) spring up in Dubai and Singapore.
"As we look around and think about the Ontario economy of five or 10 or 20 years from now, the role of biotechnology, of information technology, of clean tech, is only going to become more important," Mr. Wallace said, adding that MaRS's goal is to keep people from leaving the province, to make money from their good ideas elsewhere.
MaRS itself, with a staff of about 30, offers seminars and advice to its tenants on how to attract investors and tries to encourage new kinds of collaboration among tenants, which in addition to private firms include researchers with the University of Toronto and the University Health Network. It has received what it says is "a one-time upfront operating grant" of $5-million from the province, but is mostly financed through rent.
Don Tapscott, a professor at University of Toronto's Rotman School of Management and the author of Wikinomics: How Mass Collaboration Changes Everything, among other books, said MaRS was a precious example of the kind of collaboration between private-sector companies that he argues will translate into success after the world weathers the current crisis.
"It would be a great tragedy if somehow it were not to fulfill its mission because of economic duress," Mr. Tapscott said. "... My view is that companies need to see this as an opportunity not merely to hunker down, but to change their business models and to innovate, and that a recession is a terrible thing to waste."