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Evaluation of Expansion Proposal for International Genetic Engineering Biolabs, Inc.

(IGEB)* To Establish and Maintain a Research Facility in Collier County, Florida

Janett Benoit

IDS 4001 Dr. Timur February 13, 2012

*Fictitious company name used for the purpose of this report Executive Summary International Genetic Engineering Biolabs, Inc. (IGEB) is a multinational genetic research and development company based in San Diego, California. The company specializes in the genetic research of potentially inherited diseases and the discovery of possible medical treatments for these diseases. Our company has offices in 12 countries worldwide, including six in the United States. IGEB employs 2,000 people worldwide and is an independent research company wholly financed by private equity. Our company provides valuable research and testing resources to large pharmaceutical companies. We provide data, resources, techniques and software to our clients using a variety of animals and biological materials. (Philippidis, 2009; Trotter, 2009; Canfield, 2010). Recently the company has explored the creation of a new research facility in Collier County, Florida. Our facility would focus exclusively on genome research on mice, and would employ approximately 200 people at the onset. IGEB has evaluated this area after research into the potential for this area to offer a favorable economic climate for us to expand now and in the future. Collier County, Florida offers a well-educated workforce, a rapidly diversifying local economy, and excellent existing infrastructure. Access to higher education resources and a competitive cost-of-living makes this area highly desirable, while recent economic changes have made the area even more affordable and attractive. Additional local government incentives and special economic zones make the area financially attractive.

IGEB: Company proprietary and confidential

Introduction In 2008 IGEB began to conduct research into human genome studies using mice. Since the mouse genome is more than 90 percent identical to the human genome, this research is particularly in demand and lucrative for the company (Trotter, 2009; Philippidis, 2009; Canfield, 2010). However, only one of our existing facilities currently conducted this research. While our many facilities remain critical to our business functions, it became apparent that expanding our existing facility or repurposing other facilities would be cost-prohibitive and complex. In 2009 the company began evaluating possible locations for our new facility. In July, our company contacted the Chamber of Southwest Florida and the Collier County Economic Development Council. Our business development department conducted preliminary research into the feasibility of our expansion into Collier County, Florida. Much of this data is included in this report. Late in 2009 representatives from IGEB met with realtors and civic leaders from the area to explore our options. Our company conducted thorough research into the key economic indicators for the area including average income, employment statistics, population, housing and other critical facts. In addition to gathering this information, we were offered many special incentives from the state and county, as the region is working to transition from a local economy dependent on agriculture, tourism and the housing industry, to a more diversified local economy. The results of our proposal based on our collected data are outlined here. Criteria Our criteria for success included important factors including: Available workforce

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o Our company requires a highly skilled employee base. Local/regional income levels o We may require relocation of employees, and it is critical that the area remain cost-effective but competitive and attractive. Local/regional cost of living and quality of life
o

This must be competitive to attract and maintain quality staff.

Access to educational resources o Access to university research staff (recruiting) and cooperation will be key.

Local/regional economic outlook o Our commitment to the area and region is long-term. The area should have a good economic forecast, relative to the country.

Availability/cost of facility o Materials, land, construction and/or the availability of existing facility spaces should be competitive.

Receptiveness of the community to our business

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Business Profile of Collier County Population and Demographics

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MERGEFORMATINET

Collier County is in the Naples-Marco Metro area of coastal Southwest Florida located on the Gulf of Mexico and includes Naples, Everglades City, Immokalee, Marco Island and Golden Gate. According to 2005 estimates, the county population was 302,514. This was an increase of 83 percent from the 2000 census population (251,377) and shows a continuing trend of rapid growth, which places the county as the seventh fastest-growing metropolitan area in the nation. Conservative estimates place the 2010 population at 380,000 growing to 450,000 by 2020 (The Economic Development Council of Collier County, 2008). The county covers 2025.34 square miles. Collier County is generally affluent, as the average local income is $48,289 compared to the national average of $41,994 (US Census Bureau, 2008). Only 10.2 percent of the population in
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Collier County was living below the poverty level in 2008, compared to 13.3 percent statewide (Florida Legislature, 2009). According to the Economic Development Council, the population is slightly older than the U.S. median age (36.6) with a countywide average of 45.2 years as the median (Florida Legislature, 2009). The popularity of this area as a retirement destination skews these numbers as nearly 76 percent of the total population of younger than 65 years of age (US Census Bureau, 2008). Most of the population is located along a narrow corridor located to the west and the immediate east of U.S. Highway 41. Farther to the east, Collier County becomes increasingly rural and is dominated by agriculture. Immokalee is located near the middle of the county and is the hub of the countys agricultural base, which includes fruit, vegetable and cattle farms. Situated near Immokalee is the newly constructed planned community of Ave Maria. Ave Maria is a notable exception to the generally rural area, and is a planned suburban community centered on a Catholic university, with a high level of projected growth (Ave Maria Real Estate, 2010). Labor/ Market Profile Collier County has a fast-growing labor force increasing by 32 percent in the last six years (The Economic Development Council of Collier County, 2008). In 2007 Southwest Floridas labor force was estimated to be more than 526,720 (The Economic Development Council of Collier County, 2008). A comparison between the Collier County workforce, Florida and the United States is shown below.

Labor Force Collier

2005 144,518

2008 Numeric Change 2005-2008 Percentage Change 151,806 7,288 5%

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County Florida United States

8,670,000 9,231,000 149,320,00 154,287,00 0 0

561,000 4,967,000

6% 3%

Source: Florida Agency for Workforce Innovation, Labor Market Statistics, 6/09 (The Economic Development Council of Collier County, 2008) The labor force in Collier County is also well educated with 81.8 percent of people 25 years and older holding a high school diploma or higher (versus a state average of 79.9 percent) and 27.9 percent holding a bachelors degree or higher (versus a state average of 22.3 percent) (Florida Legislature, 2009). Cost of Living The cost of living in Collier County is higher, on average, than other counties in Florida. The University of Floridas Bureau of Economic and Business Research rank Collier County as the most expensive county in the state at 6.5 percent higher than the state average. Nevertheless, the county remains competitive as a metropolitan area, when compared to other metropolitan areas nationwide (EDC; Florida Price Level Index). Quality of Life Naples and Southwest Florida in general offers an excellent quality of life with outstanding environmental resources including beaches, Everglades National Park and a subtropical climate. Nearly 219,833 acres of Collier County land is set aside as state land for conservation (outside of Everglades National Park) (Florida Legislature, 2009). Culturally, the area offers a surprising number of options with many art galleries, museums, performance halls and sporting venues. Collier County is often called the golf capital of the world because of its many excellent golf courses (The Economic

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Development Council of Collier County, 2008). As a global retirement and tourist destination, the area is home to world-class shopping and dining. The area has a low crime rate with 2,210.3 crimes committed per 100,000 population in 2008 compared to 4,699.8 per 100,000 for Florida as a whole (Florida Legislature, 2009). Housing According to 2000 census data, more than 28 percent of Collier County housing units were classified as vacant (Florida Legislature, 2009). Today the county has a large amount of available and affordable housing as a result of its rapid growth and recent changes in the market. Developers and speculators built a large number of homes, condos and apartments in the years leading up to the housing bubble of 2007. Many of these homes were originally marketed at high rates, but, now, as a result of housing market changes, many of the prices for these homes and condos have dropped- many by half of their initial cost (personal observation). As an example, a two-bedroom condominium located in a resort area in eastern Collier County (Port of the Islands) originally selling for more than $500,000 today is being marketed in the high $100,000s. The Public School District of Collier County has 50 schools, which includes two charter schools. As of 2010 the student population was 43,214 and incorporates 30 elementary schools, 11 middle schools, 8 high schools, one mixed school (pre-K through 12), and 12 alternative school programs. The districts adult education programs throughout the county serve more than 12,000 students. The district is rated an A district by the Florida Department of Education. Forty-nine percent of the countys teachers hold advanced degrees (beyond a bachelors degree). The district is a state leader

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in technology education with more than 24,000 networked computers in use in the district. (District School Board of Collier County, 2010) The county also has many private schools, many of which are extremely highly ranked. A short list of these schools includes: The Community School of Naples Seacrest Country Day School Royal Palm Academy St. John Newman High School Corkscrew Christian School First Baptist Academy Advanced Educational Resources Collier County is home to four major institutions of higher learning: Florida Gulf Coast University A fully accredited, fast growing university with more than 9,000 students today, projected to have 15,00 students by 2012. Ave Maria University A new Catholic University that offers degrees in theology, philosophy, biology, political science, history, literature, economics and classics; as well as graduate degrees in theology (M.T.S.) and exceptional child education (M.A.E.E.). The university has a near-future goal of 5,000 students. Hodges University This is another new university that offers degrees in science as well as masterlevel degree programs in career-related disciplines.

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Edison State College Established in 1973, this college offers associate degrees as well as certificates and degrees focused on the working professional. The college provides classes for 14,000 credit and 15,000 non-credit students each year. (The Economic Development Council of Collier County, 2008). Economic Cost Benefits of Collier County and Florida The State of Florida and Collier County rank among the most business-friendly locations in the United States. Land, labor and capital are more affordable in Florida than in California, New York or Texas. The tax structure in Florida is also advantageous for businesses, with only limited corporate taxes, no state-level property tax, and no personal income tax. The state is a leader in tort reform, providing a low-liability climate for businesses and individuals alike. (The Economic Development Council of Collier County, 2008). Collier County also offers advantages that go well beyond the attractive environment of the rest of Florida. Recent developments show that the dynamic local business community, in cooperation with the state, is active participants in attracting and facilitating new industry in the area. Another biomedical company, Jackson Labs, based in Maine, has sought and has gained support from local and state leaders to receive a $130 million dollar incentive program from the state to be matched by Collier County to open and operate a 200-person facility (Shepherd, 2009; Canfield, 2010; MarcoIslandFlorida.com, 2010). We believe that IGEB could also garner this kind of goodwill and support that would translate into real savings for our company.

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In addition to these potential benefits, Collier County is also home to a special economic zone in Immokalee. In this area substantial incentives are offered for businesses that will help to transitionm this area from a rural area to a mixed development area. The incentives involve financial, training and expedited permitting. Some specific benefits include: Job tax credits Sales tax refunds for business machinery, equipment, building materials, and electricity

Property tax credit equal to 96 percent of ad valorem taxes.

A map of the area is shown below.

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(Immokalee Enterprise Zone Development Agency / Immokalee Community Redevelopment Authority Advisory Board, 2006)

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Conclusion Collier County, Florida offers excellent possibilities for our future operations. It fulfills all of our critical criteria for a new location. Available workforce
o

Collier County has a good local hiring base, and would serve as an attractive relocation destination.

Local/regional income levels o This is sufficient to facilitate a good standard of living for our employees, but also within an acceptable range for our company.

Local/regional cost of living and quality of life o Both factors are excellent.

Access to educational resources o Collier County, Florida, has many options here, and they will certainly develop even more over time.

Local/regional economic outlook


o

The region appears to continue growth in spite of recent economic setbacks. Per capita income and earnings continue to increase in 2009, while housing sales also picked up in 2009 (Florida Legislature, 2009).

Availability/cost of facility
o

Materials, land, construction and/or the availability of existing facility spaces should be competitive and even highly favorable because of local, regional and state incentive programs.

Receptiveness of the community to our business

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o Clearly, the community is receptive to our potential expansion.

Works Cited Ave Maria Real Estate . (2010). Ave Maria Boulevard. Retrieved April 14, 2010, from http://www.avemariablvd.com/

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Canfield, C. (2010, April 10). Jackson Lab Plans Flroida Expansion. Retrieved April 13, 2010, from Bangor Daily News: http://www.bangordailynews.com/detail/140902.html District School Board of Collier County. (2010). County Profile. Retrieved April 14, 2010, from District School Board of Collier County - Fast Facts: http://www.collier.k12.fl.us/about/fastfacts.asp Florida Legislature. (2009). The Office of Economic and Demographic Research. Retrieved April 13, 2010, from The Office of Economic and Demographic Research Collier County: http://edr.state.fl.us/county%20profiles/collier.pdf Immokalee Enterprise Zone Development Agency / Immokalee Community Redevelopment Authority Advisory Board. (2006). Immokalee, Florida Economic Incentives Available. Immokalee, Florida: Collier County MarcoIslandFlorida.com. (2010, April 12). Chamber urges members show support for Jackson Labs' relocation to area. Retrieved April 14, 2010, from MarcoIslandFlorida.com: http://www.marcoislandflorida.com/apps/pbcs.dll/article? AID=/20100412/MARCONEWS/100412039/1075/Chamber-urges-members-showsupport-for-Jackson-Labs--relocation-to-area Philippidis, A. (2009, October 19). Jackson Lab Eyes Expansion into Florida. Retrieved April 12, 2010, from Genome Web: http://www.genomeweb.com/jackson-lab-eyesexpansion-florida Shepherd, G. (2009, September 24). Diversifying in Paradise. Retrieved April 14, 2010, from Florida Trend magazine: http://www.floridatrend.com/biz_fl_article.asp? aID=51753

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The Economic Development Council of Collier County. (2008). Market Profile Colleges and Universities . Retrieved April 14, 2010, from The Economic Development Council of Collier County: http://www.enaplesflorida.com/contentother/contentotherdetail.aspx? ContentID=3197&CategoryID=869&m=3 The Economic Development Council of Collier County. (2008). Population 2008. Retrieved April 12, 2010, from The Economic Development Council of Collier County: http://www.enaplesflorida.com/contentother/contentotherdetail.aspx? ContentID=3194&CategoryID=870&m=3 The Economic Development Council of Collier County. (2008). State of Florida Business Advantages. Retrieved April 14, 2010, from The Economic Development Council of Collier County: http://www.enaplesflorida.com/contentother/contentotherdetail.aspx? ContentID=3430&CategoryID=852&m=4 The Economic Development Council of Collier County. (2008). The Economic Development Council of Collier County - Quality of PLace. Retrieved April 14, 2010, from The Economic Development Council of Collier County: http://www.enaplesflorida.com/contentother/contentotherlist.aspx? m=3&ref=&categoryid=871 The Economic Development Council of Collier County. (2008). The Economic Development Council of Collier County - Workforce. Retrieved April 14, 2010, from The Economic Development Council of Collier County:

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http://www.enaplesflorida.com/contentother/contentotherdetail.aspx? ContentID=3196&CategoryID=875&m=3 US Census Bureau. (2008). Census Quick Facts. Retrieved April 12, 2010, from US Census Web Site: http://quickfacts.census.gov/qfd/states/12/12021.html

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