>> thappings, katherine. let me start by thanking mayor lee for coming. welcoming steve richardson. alexander realty, who is now the owner of these buildings. steve has played a hand in many parts of what's gone on in mission barke not just here, but elsewhere. those that know him know he's had a major role in the leadership and the vision of what's going on and where we're going overall. i'd also like to mention and thank the innovation centers of the bay area and fizer for coming. nectar as well. those are companies that are nearby now in mission bay. also, the micros and the minis here, they are now, i guess by

my count, 25. mayor lee 23. there's a couple that are up in the office area, the fibrogen building that are probably -- i'm counting that he wasn't. there have been 35 total over time. some have gotten bigger and moved into larger quarters. some have venture owners that want them out of the city of san francisco and down the peninsula. some had to downsize. couldn't raise more money. so the picture has been one that's very dynamic. we would expect about 50% growth year over year. in the number of companies. internally, i would guess that a third of the companies would grow in the space they have inside the building. so it's burgeoning. it's not just doing ok or getting by.

it's a place where we reached an equilibrium. it's a turnover and a huge amount of demand out there for the resource. i would also like to mention some fibrogen people. i've had to make a list. pardon me. jenny kosor. rod ferman. rod stanley. katherine sharp. all people that work on this project every day all the time. the part i can attest to is that katherine has kept me calmed down at various times about this project, and that's her job in part, which is no fun. i think that pat kontraneo, our v.p. of finance, has been a leader and facilitator across the entire spectrum of

activities, and pat is very self-afacing and doesn't seek to credit himself. but i know what he does and he does a lot to make sure things get done right in this program. so thank you, pat. when we started, we came from south san francisco, and we came here because amgen, who competes with us in the markets, and jenentech were fighting over space there. there was a period of time when the rents in san francisco were higher than the rent here. the total cost here was still higher, but that one moment, i knew only happened once every couple decades. and so we jumped on it. we got our board to agree to let us come peer. the shorensteen family built this building. they did a very, very good job, but when we got here, we were alone and it was an economic crisis, a period of time. and we had this idea that if we

had a quality building and $100 million of improvements, that there would be a lot of young companies that would prefer this environment to the alternative, which might be a garage and clean tech. or might be a lousy building in south city somewhere. this is a tricky issue. we thought what we had would be valued. it turned out that we were right and it turned out we were wrong. we were right in the sense that a lot of u.c.f. demand came -- we had many venture firms support us and say this is a great idea, because people have hit the ground running at a time when they're normally very inefficient. we can avoid the capital outlays that go with small facilities. so we had those things. what we didn't get right was that demand was much greater. so it's turned out that it'sage

about 40%, 35% of the total demand spectrum. and for me, one of the big surprises has been the really wide variety of spaces people want, which has made it much easier for us in that we are a growing company and we have to allocate space, and especially labs, very carefully. but we've been able to fit people in in a way that might surprise you in terms of the leaseholds, the terms of agreement, the kinds of resources they're using out of our facilities, and so on. so it's been very flexible. the other point i'd make is that the citizenship has been good. all our friends, when they heard this, said you're going to regret this. you're going to have g.n.p. violations, people are going to steal your stuff, i.p., blah blah blah. it turned out not that way at all. so i don't know of a company that's been disciplined. i know of a couple of places where we had to tell people not

to put their bicycles in the hallway and stuff like that to obey code. but not much at all in that regard. and in fact, i just sort of think of it as a lot of very good citizens, what the experience has been for fibrogen. imming that part of it is important to see because we take certain risks in making the space available. today we have not been exposed or had to pay for taking those risks. in terms of the economic package, we assumed that a fully operating building, where our costs for the space they have are pushed through directly with no mark-up. it would be attractive compared to the alternative of having to build an entire leasehold at 2,000 square feet and build another one at 8,000 and build another one at 20,000, and that indeed has been the case. so people don't object about the economics and we stayed on this path of passing through the cash costs that we incur as the basis

for renting out space. the last two weeks i was in china. the cities are competing against each other for our factory in china so the back drop there is we have the first oral anemia drug, which addresses an unmet medical need throughout the world, where people cannot get therapy, it's too expressive, they can't get to hospitals, things like that. in china, there's about 20 million people that are desperately anemic by the u.s. standard. they're more anemic than the worst cases in the u.s. they're medically urgent cases.

so we're the first to do this. what we'll require is you build a factory here to make the medicine, but we'll allow you to move forward on that path. so in the course of events, i met many chinese government officials all over china. in the past two weeks, i got five different comments from different people about this program here. government officials expressing their appreciation for the fact that we would be willing to do this as a sign of how we might be as a business partner this china. and to me, that's very surprising. we do have one chinese tenant, who is an affiliate of the government. china medical city. i don't know if they're here today.

what i've learned is that a lot of people outside of the bay area are watching what we're doing with a rot of interest, -- lot of interest, because how to create the starting point for companies other than just say go find money on your own. has been difficult. particularly in life science where is a lot of infrastructures needed to be effective. so with that, thank you very much. we get the one week of the year where the weather is fantastic, or the one month, so enjoy it. it's not like this all the time. thank you very much. [applause] >> thank you, tom. now i'd like to introduce eric cher. eric has r.n.d. for solaria. solaria has been with us a little over two years, one of the companies that tom referred to earlier that they've had significant organic growth.

>> thank you. >> solaria technology started 2 1/2 years ago. at that time, we were down the peninsula. we were two people, hadn't raised money yet. the idea was try to take on big oil and replace petroleum derived chemicals, replace those with a cleaner source. that's no small order, as i'm sure you're aware. at that time, we knew that we'd have to combine together a bunch of fields that hadn't been used previously. it was about that time that we learned about fibrogen and setting up this new space. i believe we were the first or second tenant in here as a micro company. we've decided we've been able to

grow both the technology, the funding, so we recently announced we closed an additional $20 million, which is an investment we're bringing into the city, and used it to grow from two people to create about 30 jobs right now, all located in san francisco. all because of the support that we've had both from the city through mayor lee, previously mayor newsom, and todd ruffo, as well as through fibrogen. i'd like to thank tom and katherine and jenny for fully supporting our organic group. we continue to grow and develop this innovation in partnership with the fibrogen incubator exunety here. >> so now we've heard from the clean tech side.

now we'd like to welcome the c.e.o. of lexus. >> we are genetically energying a mouse for human therapeutic antibodies. they have proven to be one of the richest sources of innovative breakthrough drugs to treat human disease. a little company down the road has been built entirely on its breakthrough drugs to treat cancer and auto immune diseases. to license this mouse to companies doing antibody drug discovery so they can use it to discover the next generation of breakthrough drugs.

we've licensed our platform to five of the world's top 15 pharmaceutical companies. we believe this provides a very strong vote of confidence in what we're doing. lexus was founded in 2009. originally we were located in pasadena. i wanted to relocate the company to san francisco. i looked at a number of places in the bay area. after looking at places in the east bay and the peninsula, i realized the company should be right here in the mission bay innovation center. why? we were always going to remain small. i wanted to be a capital efficient company, and the opportunities to maintain cost control were huge by relocating the company here. being in san francisco, we are also ideally located to recruit

top talent, and we've done so. we're goiming to -- going to remain small. my standards for hiring top employees, very high. we found good employees and they've relocated from other cities in california and the east coast to work here. so we've brought new, talented people into the company. we also have people who commute in from the peninsula. i think that's another strong selling point that people in mission bay don't realize. we're at the center of a transit hub and that's very important for not only environmental reasons, but allowing people to come into the city and work efficiently. so we have employees who ride cal train. we also have employees who walk. so we're very proud to be calling fibrogen our home.

and as a vote of confidence of the future here, we have extended our lease to stay here, and i'd like to thank katherine and jenny and tom for their support in making this such a great place in which to have a biotech company. thank you. >> when this plan initially started, it came out of mayor lee's office. and the idea was presented to us by todd ruffo by the office of economic development. we talked about the micros as partners and the various innovation centers. one of our biggest partners in this has been ucsf.

with that, i'd like to introduce you to douglas crawford. >> this is a experiment that was begun maybe 1, 15 years ago. in the long term, the vitality of mission bay will depend on the small companies that come to make this home as well. it's that integration between small and large companies that made this so attractive for bay area in part to come here. so that is something that we don't often take credit for or give credit to in the mayor's office deserves credit for making that happen. at the end of the day, what will make this a community will be people that -- people are network hubs for making this

happen and qb3 is one. katherine has proven to be one of the important network hubs, and she deserves our thanks for that. so congratulations. >> i think with that, that concludes the scheduled speakers. but now i'm going to open this up to any questions that we might have from the press. ok. with that, i would invite you to either stay out here and special outside or join us inside. i believe we do have some treats in there. and fairly shortly after a few minutes, we are going to take the mayor on a tour of a couple of the labs and give him an idea of what this really looks like. thank you all for coming. [applause]