<p><a href=“http://www.crainsnewyork.com/article/20111219/EDUCATION/111219897[/url]”>http://www.crainsnewyork.com/article/20111219/EDUCATION/111219897</a></p>
<p>The inside story of Cornell’s tech campus win
How the underdog from Ithaca prevailed over mighty Stanford University in the Bloomberg administration’s competition for a new applied sciences graduate school on Roosevelt Island.
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By Daniel Massey @masseydaniel
December 19, 2011 8:48 a.m.</p>
<p>A rendering of Cornell’s winning tech campus proposal on Roosevelt Island.
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Cornell University completed its unlikely climb to the top of the city’s tech campus competition Monday as Mayor Michael Bloomberg announced the Ithaca-based institution as his choice to build a $2 billion applied sciences school on Roosevelt Island.</p>
<p>Cornell, which is teaming up with Technion-Israel Institute of Technology, emerged as the frontrunner Friday when Stanford University withdrew. As recently as Thursday, Stanford was the mayor’s preference, a source familiar with the process said, but negotiations faltered and the Palo Alto-based engineering giant bowed out.</p>
<p>Out of all the applications we received, Cornell and the Technion’s was far and away the boldest and most ambitious, Mr. Bloomberg said at a press conference Monday afternoon. Today will be remembered as a defining moment. </p>
<p>It’s still possible that the administration could make a deal for one or more additional tech campuses. The city is continuing to negotiate with New York University, Columbia University and Carnegie Mellon University, Mr. Bloomberg said. </p>
<p>A consortium led by NYU proposed a campus at 370 Jay St. in downtown Brooklyn, a city-owned building leased by the Metropolitan Transportation Authority. Columbia wants to build a campus as part of its expansion in Morningside Heights. Carnegie Mellon’s bid was in partnership with Steiner Studios for a site at the Brooklyn Navy Yard.</p>
<p>But Cornell is clearly the big winner in the competition. It will receive all of the $100 million the city had set aside for infrastructure improvements at the winning project or projects, leaving any other winner to find alternative ways to fund such work.</p>
<p>Cornell’s financial obligations, though, are substantial. The school, which formed a 50-50 partnership with Technion, is assuming financial responsibility for the construction of the campus. The project is expected to cost about $2 billion and will require substantial fundraising. </p>
<p>When Stanford announced Friday that it was withdrawing, the mayor’s representativesperhaps sensing Cornell’s newfound leveragemoved quickly to sew up a deal, finalizing an agreement over the weekend.</p>
<p>Cornell and Technion plan to start a new full-scale campus beginning in 2012, either in leased space or existing Cornell facilities in the city. The 11-acre Roosevelt Island campus would eventually grow to more than 2 million square feet and accommodate some 2,500 graduate students and 280 faculty members by 2043. As part of the proposal, Cornell committed to launching a $150 million stat-up financing fund, and to create programs that will reach 10,000 New York City students and 200 teachers per year. </p>
<p>The project is expected to create 20,000 construction jobs, 8,000 permanent jobs and result in the spin-off of some 600 companies over the first 30 years. It’s expected to generate $23 billion in economic activity and $1.4 billion in tax revenues over the first three decades. The academic program will be centered around three hubs: connective media, healthier life and the built environment. </p>
<p>We are not going to have an extension of the Technion or Cornell, said Technion President Peretz Lavie. We are going to have something new, something that will energize this city. </p>
<p>From the start of the competition, Cornell was viewed as an underdog to mighty Stanford, which is richer and more prestigious in technology and academic circles. The mayor wants to create Silicon Valley 2.0 in New York City, and Stanford had already played a vital role in the growth of the original tech hub on the West Coast.</p>
<p>But Cornell outhustled its West Coast rival. From the get-go, Cornell took aggressive steps to try to close the gap, hiring powerhouse public relations firm BerlinRosen and Suri Kasirer, the highest grossing lobbyist in the city. Cornell packed a Crain’s luncheon last summer, at which the mayor kicked off the competition, with notable alumni and top-level faculty.</p>
<p>It organized several packed forums where senior faculty drummed up support for the proposal among alumni, resulting in an online petition backing the bid that amassed more than 21,000 signatures. Cornell officials met with and won support from local groups like the Queens Chamber of Commerce for its plan to spin off companies in western Queens. And it announced its campus would include the largest net-zero energy building in the eastern United States.</p>
<p>While Stanford trumpeted a partnership with the City University of New York, Cornell one-upped its competition, forging an alliance with Technion that chipped away at Stanford’s advantage as a creator of startups. Cornell President David Skorton described an economic miracle in Israel based in large part on Technion’s role in giving birth to technology companies.</p>
<p>I think the secret weapon here is Technion, one of the premier engineering schools in the world, said Mitchell Moss, a professor of urban planning and policy at New York University. The combination of Cornell and Technion is very, very hard to equal.</p>
<p>Once formal negotiations began, it was Stanford that had to play from behind. Stanford could not or would not keep up with Cornell in the negotiations, and the administration grew concerned about the feasibility of the school’s project and its financial commitment, according to a city official familiar with the negotiations.</p>
<p>Cornell, which has experience building complex projects in the city, appeared more comfortable and familiar with the city’s negotiating style. But, more importantly, sources familiar with the negotiations said, the Ithaca-based institution seemed more driven than Stanford. One observer familiar with the process compared Cornell to a baseball team willing to spend whatever it took to reel in a high-priced free agent.</p>
<p>Stanford wanted it only if made sense to Stanford, one close observer said. Cornell wanted it at any price.</p>
<p>As late as Thursday, Stanford remained the mayor’s top choice, a source familiar with the negotiations said, but Stanford officials began to take issue last week with some of the city’s negotiating tactics and its lawyers would not sign off on promises the city was seeking.</p>
<p>Stanford sensed a bait and switch was in the works, according to a source familiar with the school’s decision to withdraw. The source said Stanford was asked to do without the $100 million in public funding the city had set aside; to accede to penalties for construction delays, regardless of cause; and to indemnify the city and take full responsibility for environmental remediation of the site.</p>
<p>But city officials said Cornell had already become the frontrunner. A city source familiar with the negotiations said both schools wanted the full $100 million and that neither was asked to pass up the funds, though smaller requests would have been viewed more favorably. And on Monday the mayor said that there were no big environmental problems with the site. </p>
<p>It does appear Cornell was willing to go further than Stanford to lower the city’s costs and risk, but on Monday city officials said they simply chose the best bid.</p>
<p>What we were really drawn to here was that of all the proposals that were submitted
this was the proposal with the most students, this was the proposal with the most faculty, this was the proposal with the most square footage, the proposal with the most aggressive timeline, the most money for startups, the most money for building and the partnership of two world class institutions that had experience in New York and had experience developing entrepreneurship, said Economic Development Corp. President Seth Pinsky. </p>
<p>Hours after Stanford bowed out, Cornell played a trump card, announcing a gift of $350 million toward its project from The Atlantic Philanthropies, the largest donation in the school’s history. The one-time underdog had become the overwhelming favorite. </p>
<p>Read more: <a href=“The inside story of Cornell's tech campus win”>The inside story of Cornell's tech campus win;