Deal close for Sanford Burnham building

UCF will pay $50M if agreement approved

UCF, the City of Orlando, Orange County and Tavistock land development company are finalizing agreements that would finally put an end to Sanford Burnham’s three-year quest to close its operations in Lake Nona Medical City.

If approved by the Orlando City Council, Orange County Board of County Commissioners and the UCF Board of Trustees on Aug. 20 and 21, the transfer agreement with UCF will close on Aug. 27 and the university will take over the 175,000-square-foot building on Dec. 1, according to documents obtained by the Orlando Sentinel. The university plans to turn it into a cancer research and treatment facility.

Here’s how the pending deal will work:

Orange County currently owns the land and Sanford Burnham owns the building. The institute will give the county the building for free. In turn, the county will sell the land and building for $50 million to UCF.

UCF, through one of its Direct Support Organizations, will pay the mortgage, without in-

terest, to the county quarterly once it starts receiving rent payment from the building’s tenants, for 30 years.

Orange County will then distribute the money among the funding parties, 43 percent of which will go to the county, 35 percent to the City of Orlando and the rest to Tavistock.

The university is also responsible for all the closing costs.

“Our county investment [in the original agreement] was over $40 million and some thought that we’d see no return, so based on the [current] deal points, there will be $50 million returned to the [stakeholders] and it’s substantially more than some of the other concepts,” Orange County Mayor Teresa Jacobs said.

Since earlier this year, attorneys for all sides have been unwinding the institute’s original agreements from more than a decade ago with the state and the three local stakeholders and drawing up new ones.

It was in May 2016 that Sanford Burnham’s plans to cease its operations in Florida were revealed. At the time, the California-based research institute was planning to hand off its operations to the University of Florida. But that deal fell through.

The institute tried to strike a deal with Florida Hospital and that deal also fell through earlier this year, leaving UCF as one of the main contenders for the site.

“Our goal is to make this an extraordinary place, and we’re going to do our very best and we’re not going to quit,” said UCF College of Medicine Dean Dr. Deborah German.

UCF presented its plans for the building to the local stakeholders earlier this year, unveiling a research and treatment cancer center with several partners, two of which are Provision Health and Sarah Cannon Research Institute.

“What matters to us about this center is that it's local and it came to meet the cancer needs of local citizens and the state of Florida. And it doesn't rule out the possibility of national impact. I look forward to 10 years from now when UCF is synonymous with cancer research and discovery,” Jacobs said.

The promise of a new agreement and end to a process that’s been fraught with disagreements and disappointments have brought new energy to local stakeholders who have been mostly mum in the past three years.

“I know that some people think that the original project was a failure. I don’t think in that fashion,” said Orlando Mayor Buddy Dyer. “I think the original deal, while not as successful as we had hoped, overall was successful in helping create [Lake Nona] Medical City. So I view Burnham as a catalyst that occurred out there.”

Sanford Burnham, which is headquartered in La Jolla, Calif., came to Florida a decade ago with more than $150 million in state incentive funds and matching funds from Orlando, Orange County and Tavistock, agreeing to create more than 300 jobs in return over a decade.

The institute reached about 87 percent of jobs promised; in the meantime, it decided to leave Orlando because it found it to be financially unsustainable. Earlier this year, the institute returned $12.3 million to the state for failing to meet the requirements that were spelled out in its original incentive agreement.

The County has $814,000 remaining in an escrow account that was earmarked for Sanford Burnham. The money will be distributed among city, county and Tavistock.

And any equipment purchased with local funds will remain in the facility, including furniture and some lab equipment.

“We are pleased that the infrastructure that has been established at Lake Nona will continue to provide a foundation for discovery that benefits human health. We look forward to facilitating a seamless transition of the Lake Nona building and anticipate the opportunity for ongoing scientific interactions with UCF,” said Dr. Kristiina Vuori, president of Sanford Burnham, in a statement.

Sanford Burnham has the option to lease space from UCF for the few remaining faculty in the building.

“We will make sure that those scientists always have the space they need to do the research and take care of them,” German said. “Our goal is not to impede science. Our goal is to promote science and to build the cancer center.”

When asked about Sanford Burnham’s legacy in Orlando, German said, “I think they awakened our community to biomedical research in a way that a state institute like UCF could not do. The fact that they were private and nationally known attracted the attention of the community.

“I value what they did here and I hope that as we build our cancer center, we will honor the commitment to research that Sanford Burnham began. Nothing is ever totally bad and totally good. I see a blessing that Sanford Burnham has given to UCF in this transition,” she said.