20 Aug Downtown Madison becoming information technology haven
Madison, Wis. – Don’t look now, but biotech might not be Madison’s only technological identity, and its emerging information technology image is being shaped in the heart of town.
As the city attempts to lure the so-called “creative class,” downtown Madison slowly is becoming a coveted destination for information technology companies. Consider the following:
- The area already is the home of IT organizations like Omni Resources (headquartered in Brookfield), Applied Tech Solutions, the Madison Enterprise Center (a small-business incubator for high-tech and light industrial), and technology tenants of the Network 222 Building – including Sonic Foundry, Matador Consulting, 5Nines Data, and Norlight Communications. At Network 222, an urban technology center, 40 percent of the building is occupied by IT or technology-related tenants.
- Technology stalwarts Google and Microsoft will open offices in the downtown area, primarily to tap into computing talent at the University of Wisconsin-Madison. Google’s engineering office will focus on hardware and software systems design, and the Microsoft’s advanced development lab will concentrate on database research.
- Acknowledging that technology ventures tend to thrive in eclectic, youth-oriented urban settings, University Research Park will target high-tech and medical device entrepreneurs with a 6,000-square-foot urban research park in the former Marquip Building on E. Washington Avenue. The initial renovation will include 10 incubator suites.
IT destination
The city’s IT reputation has been established by home-grown organizations like Sonic Foundry, Inacom Information Systems, Epic Systems, and Berbee, which was acquired in 2007 by the technology giant CDW Corp. Of these, only Sonic Foundry is located downtown.
Several reasons are given for the downtown’s emergence as a potential IT haven.
Public officials see an opportunity for urban renewal with a “creative class” twist.
Others cite the physical infrastructure, including an extensive fiber optic network and broadband redundancy, near the Capitol Square and UW-Madison.
Google and Microsoft noted the proximity to the UW-Madison’s Computer Science Department, long an important industry partner.
In the technology community, perhaps nothing has enhanced the city’s IT standing as much as computing discoveries at UW-Madison. Through professor emeritus Larry Landweber, the computer science department played a role in developing the Internet, and former department chair Guri Sohi, known for his research into high-performance computing, has consulted with several leading computer manufacturers.
The department’s latest breakthrough is the work of researchers at the university’s Nanoscale Science and Engineering Center. In conjunction with Hitachi Global Storage Technologies, they have developed a technique to increase the capacity of computer chips used in disk drives.
It’s the kind of IT discovery that should not escape the area, according to Kurt Sippel, owner and president of Applied Tech Solutions, who believes there is untapped potential for a larger downtown IT cluster. Noting that Madison failed to take advantage of the initial information technology boom, he doesn’t want to see history repeat itself.
“A lot of IT came out of here, but we didn’t capitalize on it,” said Sippel, whose company operates in 5,000 square feet of refurbished space, with two miles of data cable, on S. Paterson Street. “We missed it in favor of Austin, Texas and Eugene, Ore.”
Sipple said the city could not afford to miss the opportunities for reinvention that new generations of IT would continually provide.
The City of Madison and some of its neighborhood groups are criticized for putting up costly roadblocks to commercial development, but the city officials appear to be on the same page with Sippel.
Michael Gay, of the city’s office of business resources, said Madison’s Capitol Gateway Corridor master plan is designed to lure creative class businesses to E. Washington Avenue and blocks south. The plan involves the “adaptive reuse” of several buildings, including older industrial structures.
Building code
In the E. Washington area, rents are more reasonable than those paid for Class A space in the heart of downtown by lobbyists, law firms, and banks. Some buildings are examples of eclectic, wired structures ideal for web developers, software companies, and other IT businesses; others will require renovation.
Gay cited the Don Warren buildings on S. Paterson, the largest of which was built in 1999 by Engineered Construction. Bill Jackson, vice president of business development for Engineered Construction, said the building attracted tenants with its open, eclectic feel, green building concepts, high-speed broadband, and accommodations like showers for people who bike to work.
“A lot of the people who work there are Epic [Systems] type kids – 25-to-30-year-old IT people,” Jackson said.
Lee Ferderer, senior vice president and corporate counsel of the Fiore Companies, owner of Network 222, said there’s a workforce demographic to consider, one that is attracted to edgy urban settings and one the state is trying to retain.
“The downtown definitely is a place suitable to the younger workforce,” Ferderer said, “in that you want to work and play in the same venue.”
The city hopes the new University Research Park site, which will be connected to the UW campus Internet, expands over time and sparks its East Rail Corridor redevelopment. The architectural firm Strang, Inc. is working on the design, including technology amenities, and URP director Mark Bugher has promised an upscale facility.
Dave Hyzer, president of Strang, sees potential beyond the Marquip building. “The city evolves,” he noted, “and many of those buildings could be reused, but there also are opportunities for some of the buildings that are in bad shape to be part of brownfield development, to be rebuilt in the same area and improved.”
The IT card
Thus far, IT has been overshadowed by growth of biotechnology companies, which have been spun out of UW-Madison in greater numbers than IT start-ups. The mindset of some leaders has tilted toward life science; when WTN asked where IT fits in his economic development plans, Gov. Jim Doyle talked about the importance of IT in the context of serving life science.
While it’s true that computer technology complements life science, there is the realization that Madison has underplayed its IT card.
“I would say there has not been an intentional downplaying of that market, but I do think the R&D component has taken center stage lately,” said Larry Barton, vice president and principal with Strang. “We see a strong IT sector in this community, and we see a lot of positive things going for it.”