THE RISE OF INNOVATION DISTRICTS

THE RISE OFINNOVATIONDISTRICTS:A New Geography Of Innovation In AmericaBruce Katz and Julie Wagner

AS THE UNITED STATES SLOWLY EMERGES FROM THE GREAT RECES-SION, A REMARKABLE SHIFT IS OCCURRING IN THE SPATIAL GEOG-RAPHY OF INNOVATION.FOR THE PAST 50 YEARS, THE LANDSCAPE OF INNOVATION HAS BEENDOMINATED BY PLACES LIKE SILICON VALLEY—SUBURBAN CORRIDORS OFSPATIALLY ISOLATED CORPORATE CAMPUSES, ACCESSIBLE ONLY BY CAR,WITH LITTLE EMPHASIS ON THE QUALITY OF LIFE OR ON INTEGRATINGWORK, HOUSING AND RECREATION.A new complementary urban model is now emerging, giving rise towhat we and others are calling “innovation districts.” These districts,by our definition, are geographic areas where leading-edgeanchor institutions and companies cluster and connect with startups,business incubators and accelerators. 1 They are also physicallycompact, transit-accessible, and technically-wired and offer mixedusehousing, office, and retail.Innovation districts are the manifestation of mega-trends alteringthe location preferences of people and firms and, in the process,re-conceiving the very link between economy shaping, place makingand social networking. 2 Our most creative institutions, firmsand workers crave proximity so that ideas and knowledge can betransferred more quickly and seamlessly. Our “open innovation”economy rewards collaboration, transforming how buildings andentire districts are designed and spatially arrayed. Our diversepopulation demands more and better choices of where to live, workand play, fueling demand for more walkable neighborhoods wherehousing, jobs and amenities intermix.Led by an eclectic group of institutions and leaders, innovationdistricts are emerging in dozens of cities and metropolitan areas inthe United States and abroad and already reflect distinctive typologiesand levels of formal planning. Globally, Barcelona, Berlin,London, Medellin, Montreal, Seoul, Stockholm and Toronto containexamples of evolving districts. In the United States, districts areemerging near anchor institutions in the downtowns and midtowns—Cover: The geography of Barcelona’sinnovation district,highlighted in blue,is located in the heart ofthe city. It has servedas an inspiration for manyinnovation districts in theUnited States.Credit: Barcelona City Council.Area of Economy, Business andEmployment1

of cities like Atlanta, Baltimore, Buffalo, Cambridge, Cleveland,Detroit, Houston, Philadelphia, Pittsburgh, St. Louis and San Diego.They are developing in Boston, Brooklyn, Chicago, Portland, Providence,San Francisco and Seattle where underutilized areas (particularlyolder industrial areas) are being re-imagined and remade.Still others are taking shape in the transformation of traditional exurbanscience parks like Research Triangle Park in Raleigh-Durham,which are scrambling to keep pace with the preference of theirworkers and firms for more urbanized,“The trend is to nurture vibrant environments.living, breathingInnovation districts have the unique potentialto spur productive, inclusive andcommunities rather thansterile remote compounds of sustainable economic development. Atresearch silos.” 3a time of sluggish growth, they providea strong foundation for the creation andexpansion of firms and jobs by helping companies, entrepreneurs,universities, researchers and investors—across sectors and disciplines—co-inventand co-produce new discoveries for the market. Ata time of rising social inequality, they offer the prospect of expandingemployment and educational opportunities for disadvantagedpopulations given that many districts are close to low- and moderate-incomeneighborhoods. And, at a time of inefficient land use,extensive sprawl and continued environmental degradation, theypresent the potential for denser residential and employment patterns,the leveraging of mass transit, and the repopulation of urbancores.2

2WHAT THEY AREInnovation districts constitute the ultimate mash up of entrepreneursand educational institutions, start-ups and schools,mixed-use development and medical innovations, bike-sharing andbankable investments—all connected by transit, powered by cleanenergy, wired for digital technology, and fueled by caffeine.Given the vast distinctions in regional economies, the form andfunction of innovation districts differ markedly across the UnitedStates. Yet all innovation districts contain economic, physical, andnetworking assets. When these three assets combine with a supportive,risk-taking culture they create an innovation ecosystem—a synergistic relationship between people, firms and place (the—Boston’s 1000-acre innovationdistrict along theSouth Boston waterfront.Credit: Boston RedevelopmentAuthorityECONOMICASSETSPHYSICALASSETSNETWORKINGASSETSINNOVATIONECOSYSTEM—All innovation districtscontain economic, physical,and networking assets.3

physical geography of the district) thatfacilitates idea generation and acceleratescommercialization.Economic assets are the firms, institutionsand organizations that drive,cultivate or support an innovation-richenvironment. Economic assets can beseparated into three categories:Innovation drivers are the researchand medical institutions, thelarge firms, start-ups and entrepreneursfocused on developing cutting-edge technologies, prod-Robots come to life at—Drexel University inucts and services for the market. Due to regional variations inPhiladelphia’s innovationindustry strengths, each district is comprised of a unique mix district.of innovation drivers. Tech driven industries most likely to be Credit: Halkin/Mason Photography,courtesy of Drexelfound in Innovation Districts include:University• High-value, research-oriented sectors such as applied sciencesand the burgeoning “app economy”• Highly creative fields such as industrial design, graphic arts,media and architecture and• Highly specialized, small batch manufacturingInnovation cultivators are the companies, organizations orgroups that support the growth of individuals, firms and theirideas. They include incubators, accelerators, proof-of-conceptcenters, tech transfer offices, shared working spaces and localhigh schools, job training firms and community colleges advancingspecific skill sets for the innovation-driven economy.Neighborhood-building amenities provide important supportservices to residents and workers in the district. This rangesfrom medical offices to grocery stores, restaurants, coffeebars, small hotels and local retail (such as bookstores, clothingstores and sport shops). 44

Physical assets are the public andprivately-owned spaces—buildings,open spaces, streets and other infrastructure—designedand organized tostimulate new and higher levels of connectivity,collaboration and innovation.Physical assets can also be divided intothree categories:Physical assets in the publicrealm are the spaces accessible tothe public, such as parks, plazasand streets that become localesof energy and activity. In innovationdistricts, public places arecreated or re-configured to bedigitally-accessible (with highspeed internet, wireless networks,computers and digital displaysembedded into spaces) and to encouragenetworking (where spacesencourage “people to crash intoone another”). 5 Streets can alsobe transformed into living labs toflexibly test new innovations, suchas in street lighting, waste collection,traffic management solutionsand new digital technologies.Physical assets in the privaterealm are privately-owned buildingsand spaces that stimulate innovationin new and creative ways.Office developments are increasinglyconfigured with shared workand lab spaces and smaller, moreaffordable areas for start-ups. A—1. Coffee shops (like Detroit’s Great Lakes Coffee) arenow places for entrepreneurs to work and network.Credit: Marvin Shaouni, originally published in Model D—2. The newly constructed District Hall is the hub forBoston’s Innovation District, facilitating networking andidea-sharing.Credit: Gustav Hoiland5

new form of micro-housing is alsoemerging, with smaller privateapartments that have accessto larger public spaces, such asco-working areas, entertainmentspaces and common eating areas.Physical assets that knit thedistrict together and/or tie itto the broader metropolis areinvestments aimed to enhancerelationship-building and connectivity.For some districts, knittingtogether the physical fabricrequires remaking the campusesof advanced research institutionsto remove fences, walls and otherbarriers and replace them withconnecting elements such as bikepaths, sidewalks, pedestrian-orientedstreets and activated publicspaces. Strategies to strengthenconnectivity between the district,adjoining neighborhoods andthe broader metropolis includeinfrastructure investments, suchas broadband, transit and roadimprovements.—The new M-1 streetcar line will connect the core elementsof the Detroit innovation district—the midtown anddowntown.Credit: Anderson IllustrationNetworking assets are the relationshipsbetween actors—such as individuals,firms and institutions—that havethe potential to generate, sharpen andaccelerate the advancement of ideas.Networks fuel innovation because theystrengthen trust and collaborationwithin and across companies and in-6

dustry clusters, provide information fornew discoveries and help firms acquireresources and enter new markets.Networks are generally described aseither having strong ties or weak ties. 6Strong ties occur between peopleor firms with a working or professionalhistory that have higherlevels of trust, are willing to sharemore detailed information, andare more apt to participate jointproblem solving. Networking assetsthat build strong ties focuson strengthening relationshipswithin similar fields. These typesof assets include: “tech regulars”(where “techies” discuss problemsor advances in their work as acollective), workshops and trainingsessions for specific fields,industry-specific conferences andmeetings and industry-specificblogs for local firms and entrepreneurs.—To help develop networks, 22@Barcelona organizes manyevents including their monthly networking breakfasts.Credit: Barcelona City Council. Area of Economy, Business andEmployment“It’s all about programming:choreographing ‘spontaneous’opportunities for smart people tointeract with each other. This is whatseparates us from traditional scienceparks.” 7Weak ties occur between peopleor firms working within differentcontexts or economic clusterswhere there is infrequent contact.Weak ties provide access to newinformation, new contacts andbusiness leads outside of existingnetworks. Networking assetsthat build weak ties focuson building new relationships7

across sectors. Examples include:networking breakfasts (whereexperts and star innovators offernew insights in their fields followedby open time to network),innovation centers, hack-a-thonsacross industry clusters such aslife sciences and tech, tech-jamstart-up classes and even the choreographedopen spaces betweenbuildings.Research indicates that both strongties and weak ties are fundamental tothe innovation process and firm success.88

CAMBRIDGE: KENDALL SQUAREAnchor Plus ModelRed Line to Harvard UniversityWHITEHEAD INSTITUTEFOR BIOMEDICAL RESEARCHGENOMICSCOLLABORATIVENOVARTIS INSTITUTESFOR BIOMEDICAL RESEARCHACCELERONLAB | CENTRALBROAD INSTITUTEKOCH CENTER FORINTEGRATIVECANCERRESEARCHMASSACHUSETTS INSTITUTEOF TECHNOLOGYAKAMAI TECHNOLOGIES INCYAHOO! CAMBRIDGE INNOVATION CENTERFacebook | Apple | Highland Capital | Charles RiverVenturesGOOGLE CAMBRIDGEMIT MEDIA LABAMAZONMICROSOFTCHARLES RIVERRed Line to BostonPFIZER RESEARCHTECHNOLOGY CENTER1/4 mileAnchored by the Massachusetts Institute of Technology(MIT), and connected by transit to Harvard, MassGeneral and other research and medical institutions,Cambridge’s Kendall Square is today’s iconic innovationdistrict.Since its founding in 1861, MIT has emphasized university/industrypartnerships and the commercializationof ideas. Starting in the 1950s, the university hasactively deployed university-owned land to supportthis goal. In the last two decades, this strategy hashelped catalyze growth of a nationally significant lifesciences/pharmaceutical cluster. It has also spurredthe development of hundreds of small firms and attractedseveral major technology companies.The Cambridge Innovation Center (CIC), founded in1999 and housed in an MIT-owned building, is a goodexample of the interplay between the university andprivate sector. An independent organization, CIC hashelped develop the modern concept of co-workingwhile encouraging entrepreneurs and start-ups in itshigh quality environment. Firms at CIC have attractedbillions of dollars of seed funding and later-stageinvestment.Making Kendall Square a dynamic residential districtwith associated amenities is now a focus in Cambridge.Since 2005 nearly 1,000 new housing unitshave been built in the area, as well as many newrestaurants and retail outlets.15

PHILADELPHIA: UNIVERSITY CITYAnchor Plus ModelMarket-Frankford Trolleyto West PhiladelphiaUNIVERSITY CITYSCIENCE CENTERDREXEL UNIVERSITY30TH STREET STATIONPENN ALEXANDERSCHOOLFIRST ROUNDCAPITALUNIVERSITY OFPENNSYLVANIAMarket-Frankford Trolleyto Center CityWISTAR INSTITUTEUNIVERSITY OF THE SCIENCESVA HOSPITALCHILDREN’S HOSPITALOF PHILADELPHIASCHUYLKILL RIVERUPENN INNOVATIONAND RESEARCH PARK(PLANNED)1/4 mileHome to the University of Pennsylvania, DrexelUniversity, University of the Sciences and Children’sHospital of Philadelphia, University City is leveragingits assets in teaching, research, and medicine tobecome a hub of innovation and entrepreneurship.The University City Science Center is a driving forcebehind this evolution. Founded in 1963 as the nation’sfirst urban research park, today it comprises 31member institutions throughout Pennsylvania, NewJersey, and Delaware. Penn Medicine is anchoringthe newest UCSC building, and Drexel has openedits ExCITe Center and (in partnership with UCSC) atech incubator in the area. Both are part of Drexel’sInnovation Neighborhood project, which extends to30th Street Station. All told, UCSC’s 17-acre campushouses 2.5 million square feet of office and labspace, with business incubation, networking opportunities,and support services for a cluster of emergingand established companies in life sciences, nanotechnology,IT and other sectors.University City’s leaders are actively engaging withnearby neighborhoods. Drexel helped win a federal“Promise Zone” designation to revitalize Mantua, justnorth of the area. Penn and Drexel have also championedpublic education: Penn built and helps operatea nearby pre K-8 school, and Drexel is exploring asimilar endeavor.16

SEATTLE: SOUTH LAKE UNIONRe-Imagined Urban AreaLAKE UNIONBATTELLE SEATTLE RESEARCH CENTERMUSEUM OFHISTORY AND INDUSTRYFRED HUTCHINSON CANCERRESEARCH CENTERGATES FOUNDATIONSPACE NEEDLEALLEN INSTITUTE FORBRAIN SCIENCEUNIVERSITY OFWASHINGTONRESEARCH CAMPUSSEATTLE BIOMEDICALRESEARCH INSTITUTEAMAZONNOVO NORDISKINSTITUTE FORSYSTEMS BIOLOGYNORTHEASTERNUNIVERSITYSEATTLEPATHStreetcar toDowntown Seattle1/4 mileThe rapid revitalization of South Lake Union(“SLU”)—from a run-down, low-rise warehousedistrict a mere decade ago to a vibrant, mixed-useengine of housing, transit and global technology andlife science firms today—stands out as one of themost dramatic urban transformations in the UnitedStates.The transformation has been spearheaded by VulcanReal Estate, a company owned by Microsoft co-founderPaul Allen. In the aftermath of a failed referendumto approve a public park, Vulcan began to assembledistressed properties in the area. In the early 2000’s,it persuaded the University of Washington to locateits medical and bioscience campus in SLU. UW andthe existing Fred Hutchinson Cancer Research Centerfueled the growth of health care and life sciencefirms. In the late 2000s, Amazon decided to locateits global headquarters in SLU, accelerating growthin not only housing and retail but also entrepreneurialbusinesses.The growth of SLU has been marked by a close public/privatepartnership—including key public investmentsto build transit, fix congestion, and enhanceenergy—as well as extensive engagement of localneighborhoods and residents. Growth has been iterativeand incremental and built on trust and collaboration.19

BOSTON: INNOVATION DISTRICTRe-Imagined Urban AreaRed Line to Downtown Boston,Cambridge, Harvard UniversityWEWORK+ GENERAL ASSEMBLYVERTEXPHARMACEUTICALSBLADEZIPCAR HQFACTORY 63ONE MARINA PARKINSTITUTE OF CONTEMPORARY ARTDISTRICT HALLSEAPORT WORLDTRADE CENTERBLUE HILLS BANKPAVILIONBOSTON INNER HARBORBOSTON LOGANAIRPORTFRAUNHOFER CSEBOSTON CONVENTIONAND EXHIBITION CENTERBOSTON DESIGN CENTERHQ BOSTONMASSCHALLENGEDRYDOCK SHARED LABS1/4 mileRed Line to UMass Boston,Quincy, DorchesterIn 2010, former Boston Mayor Tom Menino outlined abold vision for a Boston Innovation District, arguing,“There has never been a better time for innovationto occur in urban settings ….”Reconnected to the city with the “Big Dig” and BostonHarbor Cleanup projects, Boston’s once-isolatedSeaport is transforming into a hub of innovationand entrepreneurship. While lacking a world-classresearch engine or an established cluster of firms,a powerful regional knowledge base combined withgood infrastructure provided a strong foundation forgrowth. Since designation, more than 200 technology,life science and other companies have movedinto the District, adding over 6,000 jobs.Several unique assets have helped to create whatis now a dynamic, collaborative environment. Mass-Challenge, the world’s largest startup accelerator,provides shared office space and no-strings attachedgrant financing to startup firms from around theglobe. District Hall is the world’s first public innovationbuilding, providing civic gathering space for theinnovation community. And Factory 63 is an experimentin “innovation” housing, offering both privatemicro apartments and public areas for working,socializing, and events.Success has wrought growing concerns about affordability.Private investment is expected to add thousandsof housing units over the next few years.20

RALEIGH-DURHAM: RESEARCH TRIANGLE PARKUrbanized Science ParkvGRIFOLSRTI INTERNATIONALSIGMA XIPARK CENTERRESEARCH TRIANGLEFOUNDATIONSYNGENTAPROGRESS CENTERBD TECHNOLOGIESBASFFIDELITY INVESTMENTS1/4 mileRecognizing that the 20th century model of suburbanscience parks demands an update, ResearchTriangle Park (RTP) leaders are working to urbanizeportions of the 7,000 acre park and its environs.Hailed as a center of innovation since the late 1960s,by the mid-2000s RTP stakeholders became concernedthat the park’s sprawling structure and closedresearch environment could hinder its long termsuccess. In response, in 2012 the RTP foundationreleased a new 50-year master plan for physicallyremaking the area, with the purpose of both enticingworkers to live nearby, and keeping and attractingfirms that want to benefit from the “random collisions”that density and open innovation offer. “Manyof today’s knowledge workers expect amenities andopportunities to connect and share ideas in a sociallydynamic setting,” the plan observes. “The independentcampuses at RTP, mostly hidden behind trees,do not reflect this trend.”Build-out of the urbanization plan will begin withPark Center, a nearly 100 acre site at the heart ofRTP that will be redeveloped to include high-densityresidential and mixed-use buildings. RTP is also advocatingfor a new commuter rail system that wouldconnect the park to the downtowns of Raleigh andDurham.21

Endnotes1. Anchor institutions are research universities and research-oriented medicalhospitals with extensive R&D.2. Select excerpts come from the recent book, The Metropolitan Revolution,co-authored by Bruce Katz and Jennifer Bradley.3. Pete Engardio, “Research Parks for the Knowledge Economy,” BloombergBusinessweek, June 1, 2009.4. See Christopher Leinberger and Mariela Alfonzo, “Walk this Way: The EconomicPromise of Walkable Places in Metropolitan Washington DC” (Washington:Brookings Institution, 2012).5. Michael Jaroff, Dennis Frenchman, Francisca Rojas, “New Century CityDevelopments Creating Extraordinary Value” (Cambridge: MassachusettsInstitute of Technology, 2009).6. Mark Granovetter, “The Strength of Weak Ties,” American Journal of Sociology78 (6)(1973): 1360-1380.7. Dennis Lower, President and CEO, Cortex8. Tom Elfring and Willem Hulsink, “Networks in Entrepreneurship: the Case ofHigh-technology Firms,” Small Business Economics 21 (2003): 409-422.9. Research Triangle Foundation of North Carolina, “Research Triangle Park:Master Plan” (2011).10. Professor Etzkowitz, “Innovation in Innovation: The Triple Helix of University-Industry-GovernmentRelations,” Social Science Information: 3 (2003):293-337.11. Peter Hall, Cities in Civilization: Culture, Innovation, and Urban Order (London:Phoenix Giant, 1999).22

About the AuthorsBruce Katz is a vice president at theBrookings Institution and founding directorof its Metropolitan Policy Program.Julie Wagner is a nonresident senior fellowwith the program.For More InformationAlex JonesPolicy/Research AssistantBrookings Metropolitan Policy Programacjones@brookings.eduAbout the Metropolitan Policy Programat BrookingsCreated in 1996, the Brookings Institution’sMetropolitan Policy Program provides decisionmakers with cutting-edge researchand policy ideas for improving the healthand prosperity of cities and metropolitanareas including their component cities,suburbs, and rural areas. To learn morevisit: www.brookings.edu/metro23