A massive infusion of private funds from three private companies has allowed Toronto-based technology innovation incubator MaRS Discovery District to repay the $300 million it borrowed from the province of Ontario.
Manulife, Sun Life Financial and iA Financial Group led the $290-million transaction by investing in 19-year bonds issued by Phase II Investment Trust.
A press release from the innovation centre said, “The proceeds of this transaction will be used to repay most of the Ontario government’s interest-bearing loans to MaRS almost three years ahead of schedule.”
“Canada now has an urban innovation hub at a scale that is fully competitive with any global counterparts,” commented Ilse Treurnicht, CEO of MaRS. She adds that the West Tower is also now fully leased, and could soon generate the operating income required to be entirely self-sustaining, “putting MaRS on stable footing for decades to come.”
But this wasn’t the case just a few short years ago.
Back in 2014, the Liberal government of Ontario extended a $309 million interest-bearing loan to MaRS, with the assumption that the tower would achieve 80 per cent occupancy. About $65 million of that money was used to buy out an American developer. For months, the building was close to two-thirds empty, that is until 2015, when prospects for the West Tower picked up gradually, and then Facebook Canada announced it was setting up shop in the tower.
Today, the centre offers more than 1.5 million square feet of state-of-the-art lab and office space and is home to more than 140 research labs and companies spanning the entire innovation ecosystem.
Noteworthy life science tenants include multinational medical firms such as Johnson & Johnson’s JLABS @ Toronto, which itself houses over 40 biotech and health startups and biopharma company Merck, as well as a growing number of emerging life science firms like Synaptive Medical, Deep Genomics, Interface Biologics, Highland Therapeutics and Triphase Accelerator. Additionally, biotech incubator Blueline Bioscience and leading research groups from the University of Toronto (which owns a 20 per cent stake in the West Tower), University Health Network (including Princess Margaret Cancer Centre), Ryerson University and the Ontario Institute for Cancer Research, all now call the West tower home.
“We are grateful that the Government of Ontario stepped up to help us solve an unforeseen problem, and we are delighted to welcome Manulife, Sun Life and iA Financial Group as financing partners. MaRS has incredible momentum and is well positioned to build on this successful foundation for many years to come,” said Gord Nixon, chair of the board of directors at MaRS.
In all, between 2008 and 2015m ventures within the MaRS network raised $2.6 billion in capital and generated $1.3 billion in revenue, and today employs more than 5,200 people.
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