$100 million EB-5 project AnC Bio breaks ground in Newport

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$100 million EB-5 project AnC Bio breaks ground in Newport

Thu, 05/14/2015 - 3:56pm -- tim

by Timothy McQuiston Vermont Business Magazine This is different. Thursday morning Bill Stenger and his development group, contractors and associates stuck their silver shovels into a pile of dirt for the ceremonial groundbreaking of AnC Bio Vermont in Newport. On Monday an actual excavator will dig into the ground next to the former Bogner plant to begin the real construction, and right after that, lead developer Bill Stenger will fly off to the Middle East and Africa and try and raise the last $10 million in EB-5 immigrant investor money needed to complete the financing of the $100 million bio-medical facility.

Stenger, whose day job is president of Jay Peak Resort, is also a lead developer and spokesman for what is a $600 million group of projects. These are not all EB-5 funded projects, but they include several developments at Jay Peak and some more at Burke Mountain, a significant upgrade to the airport in Newport (including nearly 300,000 square feet of related buildings, expanded apron and an additional 1,000 feet to the runway), and a new hotel and related amenities in downtown Newport.

For the most part, these projects are directly or indirectly related to the hospitality industry.

But with AnC Bio, the developers are going in a self-acknowledged new direction.

“This is a technology world that we are embracing now,” he said.

Bill Stenger, with Dr Ike Lee, at the groundbreaking Thursday morning. Above, Stenger and his team throw the ceremonial first shovel full of dirt. VBM photos

The 85,000-square-foot will require 350-400 construction workers to build to meet FDA clean room standards. They will do “stem cell” manufacturing and research and development and also develop and build bio-medical devices. The clean rooms will also be available to other researchers to do their work.

These facilities, Stenger said, are rare and needed and AnC Bio Vermont will be ahead of the curve in its availability.

“The bioscience industry is the fastest growing industry in the world,” Stenger said.

Stenger said the debt-free, state-of-the-art facility will take about 18 months to build and its clean rooms will need to get FDA certification. When the facility opens in the fall of 2016, it will employ about 300 technicians, administrators and scientists, which he anticipates will ramp up to 400-450 once fully operational.

“We’ve had the opportunity to raise millions of dollars to employ thousands of people,” Stenger said.

Typically, chief scientist Dr Ike Lee said, a large firm like Biogenesis, perhaps, or a pharmaceutical company or a hospital, will have a product it wants to develop and will come to AnC Bio to do the testing and ultimate manufacture of, say, a stem cell product targeted for a very specific medical treatment.

“We are creating the blue ocean of this industry,” Lee said, even joking that nearby Lake Memphremagog and the Green Mountains are part of that ocean of innovation.

“It’s not just a box we are building,” Stenger said.

AnC Bio will not be doing the initial research, but with heavy FDA regulation, a stem cell developer will want a single facility where it can both research and ultimately bring to market a product in one already-approved facility. Switching facilities after production had begun would otherwise require new FDA approval and the time and money that would additionally require.

Artist rendering of the AnC Bio Vermont facility. The old Bogner plant to the left will be a separate building, which is destined to become a warehouse and will not be part of the FDA approved complex.

By using AnC Bio, the developer of the new stem cell product would not have to build their own facility and would not have to get their own certification.

Stenger and Lee said there is a vast worldwide market for a clean facility such as this.

The stem cell market is valued at $1.4 billion now and it’s expected to be a $160 billion market by 2030.

The Vermont facility will have no debt, Stenger said, and the market is ripe. EB-5 has provided the capital without the impatient demands of a private equity investor from Silicon Valley and without a staggering loan repayment to a commercial lender.

Noticably absent from the ceremony was the governor, his top development officials and state legislators. Stenger, who originally timed the event for after the conclusion of the legislative session, said state officials were all down in Montpelier going through the end-game of the budget process, with still a lot on the line for spending and taxes.