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San Antonio land deals help launch major biotech investment fund
February 3, 2016

TRTF Chairman Jim Dublin, left, and President York Duncan said the launch of a new investment fund to support early-stage life sciences and technology companies in San Antonio will pay major dividends. CARLOS JAVIER SANCHEZ / SAN ANTONIO BUSINESS JOURNAL

By W. Scott Bailey Reporter/Project Coordinator,
San Antonio Business Journal

The Texas Research and Technology Foundation has leveraged money from the sale of two key parcels of Texas Research Park land to launch a new investment fund to support the development of more early-stage life sciences and technology companies in San Antonio.

The Robert F. McDermott Legacy Investment Fund, named for the deceased Air Force general who was a major player in San Antonio economic development and who helped inspire the creation of the TRTF, will be launched with an initial $1 million capital infusion.

The TRTF is also launching a permanent endowment fund named for Nancy and Tom Pawel, who donated 1,500 acres in 1986 for the Texas Research Park.

“It was McD who helped urge Tom to do this,” Nancy Pawel said about McDermott and her husband, and their talks about contributing land for a research park. “We had an awful lot of land. It was a good idea.”

While geographic challenges have limited opportunities for medical-related development at the park, the real estate has become a more valuable asset for other uses, prompting the TRTF to change its game plan. I reported exclusively in October that the TRTF had decided to sell roughly 800 acres of research park real estate and use the proceeds to create a perpetual fund to invest in more early-stage companies.

The sale of two parcels of research park land have enabled the TRTF to follow through on its plans. A California investment group bought the 76-unit Pawel Village apartment complex and 12.5 acres of land for an undisclosed sum. In a separate deal, Microsoft Corp. (NASDAQ: MSFT) acquired 158 acres of research park real estate, on which it plans to develop a large data center. The terms of that deal also were not disclosed.

TRTF President York Duncan said there is serious interest in additional research park acreage.

Jim Dublin, chairman of the TRTF, told me months ago the sale of research park land could fetch as much as $60 million. With two deals already closed, he is convinced the foundation has made the right move.

“By establishing this investment fund, we will be able to focus on growing life science and technology companies in San Antonio and helping entrepreneurs to build their dreams,” Dublin said. “If we can create more companies built around the life sciences and technology, which is the biggest piece of our economy, then we are going to create more jobs, put more money into this community and give more people opportunities.”

Dublin said the investment fund will help nurture local companies and attract others to San Antonio. The TRTF will take the revenue from the sale of any companies it has invested in to expand the investment fund.

I asked Nancy Pawel what she thought her late husband would think now that the TRTF is looking to sell the land that the couple donated to fund new companies.

“I’m sure he would have been very proud,” Pawel said. “I think this has turned out very well."

W. Scott Bailey covers health care, tourism, sports business, economic development; he also plans and edits some special reports

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