Students may not have noticed it, but Yale’s campus grew by a third on Tuesday morning.
This week, the University finalized its purchase of the 137-acre Bayer HealthCare campus for $109 million. Although the deal was first announced in June, Bayer and Yale officials have been conducting due diligence and hammering out details until now, administrators said. Yale paid up front and in cash, through a wire transfer.
The campus, which administrators have nicknamed “Yale West,” has 1.5 million square feet of buildings, including 550,000 square feet of laboratories. The facility also includes office space and warehouses, which administrators have said will be used to store overflow from Yale’s many museum collections.
Though Yale now owns the property, no University activities will take place there until at least next summer, Yale President Richard Levin said. The University hopes to fill the space with top-notch researchers recruited from other institutions, he said.
“We are going to focus on external recruitments — building programs around hiring outstanding scientific leaders to try to attract them to Yale,” Levin said.
Bayer will not fully vacate the facility until the end of next year, Vice President for New Haven and State Affairs Bruce Alexander said. Until then, the company will lease the office space from the University.
No major renovations are needed to ready the Bayer facilities for Yale’s use, except to modify laboratories to researchers’ specifications and to add better heat and humidity controls inside the spaces that will be used as storage for the Peabody Museum and the art galleries.
Putting together the cash to buy the facility was not difficult because the University generally keeps several hundred million dollars of cash on hand, Levin said. Yale may borrow against the science buildings in the future because they will provide a steady flow of grant money, he said.
At an average cost of roughly $73 per square foot, the new acquisition was a deal for the University, administrators said. Lab space alone generally costs Yale between $650 and $700 per square foot to construct, Levin said.
The University was able to secure such a good price because no competitors bid for the entire facility, Levin said. The other bidders were retail development companies and thus had no interest in bidding for the lab space, he said.
“Had another pharmaceutical company stepped up, it would have been very different,” Levin said.
Because Yale, as a tax-exempt organization, will pay no property taxes on the site, the University will make voluntary contributions to Orange and West Haven, where the Bayer facility is located. Yale will make its first payment of about $600,000 to the two towns combined in October 2008. In addition, the University has already started to work with the West Haven school district to develop curricula and train teachers, West Haven Mayor John Picard told the News. About 80 percent of the new property lies in West Haven, and the rest is in Orange.
Yale’s presence in West Haven could also spur economic development in the town, Picard said, as he envisions shops and restaurants opening in the city’s downtown area to serve Yale West employees.
“I don’t think we all fully realize what’s going to take place over the next five to 10 years,” he said. “We’ve just begun to scratch the surface of considering the impact this will have.”
Alexander and a Bayer official called Picard at around 11:30 a.m. Tuesday to announce the conclusion of the deal, Picard said.
No Bayer officials were available for comment Wednesday.
The Bayer campus went on the market last November, after the company decided to relocate its Connecticut operations. When the property went up for auction, Yale was among 15 bidders. The Corporation approved the purchase when it met for Commencement in late May, Levin said.