Paul McMorrow

The tech cluster glut

By Paul McMorrow
July 9, 2011

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SOMEBODY IN Boston is about to get burned by the promise of high-tech development. Boston has four major medical and biotech clusters in various stages of assemblage. They’re all competing with Cambridge. Increasingly, it’s looking like Crosstown, the mayor’s last attempt at research-driven neighborhood-building, will be the odd cluster out, a victim of the city’s successes along the South Boston waterfront

Research clusters exist because good things happen when like-minded folks, be they colleagues or competitors, work alongside each other. By definition, clusters demand density. The bigger they are, the better. The opposite is true, too: As interdependent clusters are fractured and watered down, the returns they produce diminish. And since there’s only so much venture capital and government research funding to fight over, their potential size is finite as well.

Every attempt at tech-cluster development around Boston has Cambridge looming in its rear-view mirror. Kendall Square is the hub of New England’s innovation economy. And notwithstanding South Boston’s recent encroachment into Cambridge’s lunchbox, Kendall is as huge a draw as ever. Three recent deals, by Novartis, the Broad Institute, and Biogen more than replaced the square footage vacated by Vertex’s defection across the Charles. Biogen’s tentative move is especially significant. The biotech firm decamped Cambridge for sparkling new headquarters in Weston just last year, and got buyer’s remorse almost immediately afterward. The company reportedly missed the community and access to talent that Cambridge offers. Now it’s scrambling to get back into Kendall, and it will likely pay a premium to do so.

So far, the South Boston innovation district is as much of a marketing tool as it is a formidable cluster. Vertex, the neighborhood’s big prize, tried to jump from Cambridge to the waterfront in 2008, back when City Hall was calling the area the Seaport district. Vertex’s continued commitment to South Boston does speak volumes about the mayor’s dogged recruitment efforts. But the development projects that should make the area a unique draw for entrepreneurs - cheap, European-style live-work apartment complexes - remain sketches on city planners’ desks. Without housing, South Boston remains Kendall Light. Despite all its growing pains as a tech destination, though, there’s a real buzz on the waterfront. Companies are crossing the Fort Point Channel. Cheap converted warehouse space is filling up. The innovation district isn’t the throwaway line it seemed to be when it was first announced. City Hall sunk serious political capital into South Boston, and it’s paying off.

City Hall spends so much time talking about its South Boston project that it’s easy to forget that the type of district it’s trying to create already exists - in the Longwood Medical Area. Longwood bustles with research labs that thrive on the neighborhood’s deep roster of medical institutions. The bench-to-bedside environment they enjoy can’t be replicated anywhere else in the region. So Longwood’s research cluster isn’t going anywhere.

Between Kendall Square, South Boston, and Longwood, the urban research arena is a crowded one. Harvard University, which already has a medical research presence in Longwood, is currently trying to muscle into this tight space. The school’s old plans for its Allston acreage envisioned the creation of a new center of gravity along the Charles for medical and biotech researchers. Its current scheme, which would combine institutional and privately-financed development, is a variation on the same theme. The school faces the handicap of building a cluster from scratch, but it does have the country’s biggest endowment to push the process along.

Lost in all of this is Crosstown, City Hall’s old preferred landing spot for medical and biotech researchers. The corner where Dorchester and Roxbury meet the South End was supposed to have been rescued by researchers who would flock to be near Boston Medical Center and Boston University’s biolab. The mayor sold the neighborhood hard, but the promised renaissance never came. A hotel built with public financing defaulted on its bonds in late 2009. The little lab space that has been built hasn’t gained the critical mass it needs to be transformative. And the future looks cloudy, now that the entrepreneurial energy that was supposed to save the neighborhood is being steered to other corners of the city. As the vacant lots along Melnea Cass Boulevard show, there’s only so much high-tech development to go around.

Paul McMorrow is an associate editor of CommonWealth Magazine. His column appears regularly in the Globe.