One of the fastest-growing technology companies in North America has signed a 13-year lease for 50,000 square feet of office space at the University of Delaware’s Science, Technology and Advanced Research Campus.
Delaware-based SevOne, so rated last month by Deloitte’s Technology Fast 500, is precisely the sort of tenant the university is hoping to attract to the high-tech STAR Campus, once home to a Chrysler assembly plant.
SevOne is a network and data center performance management company. According to its website, companies such as Verizon Wireless, Comcast, NASDAQ and Morgan Stanley rely on SevOne to keep their information technology infrastructures humming.
SevOne will initially bring about 150 jobs to STAR, according to Ernie Delle Donne of Delle Donne Associates, which is developing 18 acres of the adjunct campus. The firm expects to expand that total to 300, he said.
The lease was signed Friday, Delle Donne said. SevOne, launched in 2005, did not return a request for comment.
Along with three smaller tenants, SevOne’s move into the campus’s “Phase II” building maxes out all currently available space at STAR, Delle Donne said. The structure shares a wall with the Phase I building, which now houses UD’s College of Health Sciences.
In addition to its Pike Creek location, SevOne also has offices in Philadelphia and Boston. Ranked 151st on Deloitte’s 500 – the rankings are based on percentage of fiscal year revenue growth – it has the backing of Bain Capital, which in 2013 invested $150 million in the firm.
“We’re just thrilled that they’re staying here,” said Patrick Harker, UD’s president. “And we’ll continue to grow, as they continue to grow.” Harker said the decision is particularly meaningful given the firm’s UD roots, having been founded by grads Vess and Tanya Bakalov, who make a point of employing other UD students. Last year alone, the company hired 12 UD grads and provided internships for 17 students.
Gov. Jack Markell pointed to Delaware’s No. 2 ranking in the 2014 State New Economy Index, published in June by the Information Technology and Innovation Foundation, a nonpartisan think tank. The report gave Delaware high marks for its technology-driven economy – which, it said, “leads to complementary work in non-IT fields.”
“By expanding their business in Delaware, SevOne will have access to Delaware’s talented workforce, providing significant employment opportunities to the community,” Markell said.
Delle Donne said SevOne’s decision came as a surprise to industry insiders who began calling him a week ago as the news began trickling out. Lawyers, brokers and competitors in other cities, he said, asked variations on this question: “Why would you pick Newark over Boston?” And I said, “You guys just have no clue.”
A major strength here, Delle Donne said, is “the synergy with what we like to call 25,000 highly motivated, unemployed people called students. The labor pool there is absolutely phenomenal.”
He also points to the shuttle system that connects STAR with the rest of UD; the two nearby exits off I-95; the opportunity to establish a relationship with the highly regarded school; and the adjacent SEPTA train station – which officials are pressing to get modernized. He noted a Monday story in The News Journal about the system’s planned increase in commuter rail trips to Delaware.
In addition to SevOne, Delle Donne said much of the remaining space in the Phase II building will be filled by Glasgow Medical Center, which will build a new medical aid unit, and Newark’s Independence Prosthetics-Orthotics Inc., which will establish a satellite-type office focused on prosthetics.
Independence Prosthetics is already closely aligned with the school, working with the UD Physical Therapy Clinic, the Department of Kinesiology & Applied Physiology and the multi-school, UD-led BADER Consortium, which works with the Defense Department to develop optimal function for troops who require orthopaedic rehabilitation. Independence has taken on about 40 UD mechanical and biomedical engineering students as interns over the past two years, he said.
“The whole collaboration piece really is the key,” Horne said.
“Strategically, I think it makes good sense,” said Mark Doughty, chief operating officer for Glasgow Medical Center, which has three current locations and expects to employ 10 to 15 clinicians and staffers at the new unit. “It’s an opportunity for us. The location is right; it fits our needs in every way.”
STAR, he said, “is going to get built out and end up probably being a pretty big retail hub. It’s going to become a center of Newark. You have the train station there, not to mention all the construction that’s going to be going on. … We want to make sure we can take care of those people that get hurt or sick.”
A 10,000-square-foot wet lab incubator space affiliated with Delaware Technology Park is also expected to be part of Phase II. Negotiations are continuing, Delle Donne said.
Delle Donne sees SevOne as the spark that turns STAR from a curiosity into a destination for firms that specialize in science, technology and advanced research.
“It is such, such good news,” Delle Donne said of SevOne. “This is a big, big firm. This is going to be a multi-billion-dollar company.”
Delle Donne said he already has other concerns – such as capacity. “We have about, I’d say, 20,000 square feet of tenancy right now that I can’t handle,” he said. “That wants to be there. We’re full. … We need to keep 50,000 to 100,000 feet of space available to stay in front of the curve – so that when that next company comes, it’s there and it’s ready.”
UD owns the property and is leasing it to Delle Donne, who owns the buildings being erected and leases them back to the university. To date, Delle Donne and builder Stephen Mockbee have not borrowed to finance the development, he said.
“Now that we have a lead tenant, now that it is occupied, now we can permanently finance it,” he said. “And we can recycle those dollars.” In other words, they’ll gain some headroom. Now, he said, they’ll need it to move ahead.
“With the announcement of SevOne, as well as having no space available, I would anticipate that the tenant interest now goes up fivefold,” Delle Donne said. “Because nothing succeeds like success. And when a national IT concern like SevOne blesses this property … now the herd instinct follows.”
That would be a welcome development, Harker said.
“Of course, we’d like it to move faster,” he said. “I think everybody would. But we’re coming out of the recession, and we’re now starting to see not just glimmers of daylight, but … a lot of activity and interest. And that’s a good thing.”
Contact William H. McMichael at (302) 324-2812 or firstname.lastname@example.org. On Twitter: @billmcmichael.