Daily Business Report-Oct. 28, 2015
Northrop Grumman’s model of a Long Range Strike Bomber.
Northrop Grumman Wins Air Force
Long-Range Strike Bomber Contract
Northrop Grumman has beaten out a team of Boeing and Lockheed Martin for the highly-anticipated contract to build the U.S. Air Force‘s Long Range Strike Bomber plane, Defense Department officials announced Tuesday.
The service branch plans to purchase up to 100 of the bombers at a cost of $511 million per plane in 2010 dollars, Air Force acquisition lead William LaPlante said at the press conference to announce the contract.
The total cost of the program could total more than $55 billion and that figure includes $21.4 billion for the bomber’s engineering phase, LaPlante said.
The planes will be built at a plant in Palmdale.
Lt. Gen. Arnold Bunch, military deputy to the Air Force’s acquisition assistant secretary, said Boeing and Lockheed will receive a debrief on the selection Friday and will have 100 days to file a protest with the Government Accountability Office.
Air Force officials eye initial operating capability for the bomber in the mid-2020s and want the plane to carry nuclear and conventional weapons.
This initial award includes a cost-plus incentive fee development contract and a fixed-price incentive fee agreement on the first five low-rate initial production lots for 21 bombers.
With this award, Northrop will receive a boost to its aerospace systems segment that saw revenue remain flat in its second quarter for 2015 compared to the same period last year.
Northrop will release its third quarter financial results this morning and its shares spiked 10.65 percent to $191.25 in post-market trading.
Air Force Secretary Deborah Lee James said DoD brought in outside advisers to determine the LRSB program’s total cost and the LRSB bomber will eventually replace the service branch’s B-52 and B-1 bombers, which have been in the fleet for more than 50 and 70 years, respectively.
Gen. Mark Welsh, Air Force chief of staff, said the service branch will take an open architecture approach for the bomber’s technology in the plane’s development process.
Assembly Speaker Toni Atkins (D-San Diego) hailed the contract award. “This announcement means thousands of jobs will be coming to California, and that’s great news,” said Atkins. “When the Legislature created the tax credits to help Northrop Grumman and the team of Lockheed Martin and Boeing compete for the Department of Defense’s long-range bomber project, this is exactly the outcome we wanted to see. This also shows our approach to use targeted tax credits tied to actual job creation is a better model than Texas-style corporate giveaways. Both bidders, Northrop Grumman and Lockheed Martin / Boeing, made strong proposals, but the real winner is California’s workforce.”
Government Contracting News Wire
BNBuilders Begins Construction on
Illumina San Diego Facility Expansion
BNBuilders has been contracted to construct the interior of a new 300,000-square-foot facility that will expand Illumina’s existing San Diego operations.
BNBuilders is providing both pre-construction and construction services to Illumina. The project will include the expansion of the central plant, and the interior build-out of the shell into a manufacturing facility, warehouse, as well as labs, office and general support space. Designed by Ewing Cole, the Illumina expansion is projected to be complete in late 2016.
“Illumina and BNBuilders both value innovation, and it creates an exciting and rewarding synergy when the entire project team is assembled,” said Ross Brown, project executive for BNBuilders. “We are proud to be part of Illumina’s growth, and the continued expansion of the overall life science industry in San Diego.”
The firm has recently completed laboratories, manufacturing, and R&D facilities for Celgene, Gilead, Amgen, Calibr, and Illumina.
Founded in 2000 in Seattle, BNBuilders specializes in preconstruction and construction services for life science, biotech, healthcare, education, commercial, public, multi-family residential, and office markets. With six offices, 300+ employees, and a strong presence in the California, Washington, Oregon, and Montana construction markets, BNBuilders is a leader and preferred contractor on the West Coast. BNBuilders’ San Diego office was opened in 2010.
Murphy Development Breaks Ground
On the First Spec Industrial Building
Murphy Development is nearing build-out of its 2.1-million-square-foot Siempre Viva Business Park on Otay Mesa with the recent groundbreaking of the 121,970-square-foot Building 18. The development team includes architect Gene Cipparone, K&S Engineering and Lusardi Construction as the general contractor.
The concrete tilt-up Building 18 is located at 2600 Melksee St.
As soon as a lease is executed on Building 18, Murphy plans to start construction on the final Class A industrial building at Siempre Viva, a 79,000-square-foot spec building at 8500 Kerns St.
Murphy Development’s newest project on Otay Mesa is Brown Field Technology Park (BFTP), which is planned for 1 million square feet of corporate industrial space. Grading and the storm drain system have been completed and the balance of site improvements will be completed in early 2016. The 50-acre BFTP can deliver freestanding buildings between 75,000 and 300,000 square feet within a year.
Swift Real Estate Partners Buys
Sorrento Mesa Office Building
Swift Real Estate Partners purchased a three-story office building at 5405 Morehouse Drive in Sorrento Mesa from Cruzan. The 51,471-square-foot, office building was 92 percent leased at the time of sale. Financial terms were not disclosed.
Built in 1988 on 1.98 acres, the building was renovated in 2013 with resort-style restroom fixtures and lobby finishes as well as an atrium courtyard with seating areas and a water feature. Project tenants include a mix of technology companies, financial and insurance services firms, and biotech users.
CBRE announced the sale.
Top Researchers to Announce Recipients
Of Alzheimer’s Drug Discovery Fund
San Diego city and county leaders today will announce the first recipients of a research fund that aims to accelerate efforts to find a treatment or cure for Alzheimer’s disease.
Eight world-class researchers have been selected by Collaboration4Cure, an innovative grant program established last year, to pursue promising drug discovery projects. They will be given access to drug-screening robots and other resources at Sanford Burnham Prebys Medical Discovery Institute (SBP) and The Scripps Research Institute.
The initial grants, totaling nearly $500,000, were made possible by a donation from San Diego philanthropist Darlene Shiley, along with contributions from other locals.
The recipients were screened and selected by a Collaboration4Cure committee led by the region’s top research institutions. The grant program is an offshoot of The Alzheimer’s Project, the San Diego County-led initiative launched last year to find a cure and to help Alzheimer’s patients, along with their caregivers.
Scripps Mercy Surgeon Elected
To Commission on Cancer
Paul Goldfarb, M.D., a longtime oncologic surgeon with Scripps Health and resident of Mission Hills, has been elected to a three-year term as a member of the American College of Surgeons Commission on Cancer (CoC). Goldfarb is the medical director of the O’Toole Breast Care Center at Scripps Mercy Hospital San Diego.
The CoC is a consortium of cancer care professionals dedicated to improving survival and quality of life for cancer patients through standard setting, prevention, research, education and the monitoring of comprehensive quality of care. CoC membership consists of more than 100 individuals from 56 organizations nationwide, representing the multidisciplinary professionals that comprise the cancer care team.
“The Commission on Cancer is the leader in advocating for improvements in care for cancer patients, and they share Scripps’ commitment to high-quality, patient-centered care,” said Goldfarb, who will represent the ACS Fellowship as a CoC member.
Governor: Climate Change Challenge
Moral Equivalent to World War II
Times of San Diego
Gov. Jerry Brown told climate scientists at the Scripps Institution of Oceanography Tuesday that addressing climate change is the moral equivalent to building the atomic bomb first in World War II.
He likened the “existential threat” of climate change to Nazi Germany, and noted that California’s universities managed the national laboratories that built the bomb 70 years ago.
“That’s a good predicate to how to deal with the existential threat of climate change,” he said. “I can’t emphasize enough how important the University of California is in meeting this existential threat.”
Brown spoke at the two-day UC Summit on Carbon and Climate Neutrality, a gathering of climate scientists from around the nation with a goal of developing ten solutions to slow climate change.
The governor’s comments come just weeks after he signed signed legislation mandating that half of the state’s electricity come from renewable sources by 2030, and he expressed confidence that California can lead the way on solar power, electric cars and other new technologies.
“All the things that skeptics say are bad, California is doing. And the results show they’re good,” he said.
But he warned that there remains serious opposition to dealing with climate change. “We are up against very powerful opposition: partisan, industrial and media,” he said.
One goal of the conference is to showcase progress being made at Scripps and other University of California institutions at developing responses to climate change.
Walmart Wants OK to Test
Drones for Making Deliveries
Walmart has become the latest U.S. retailer to ask for permission to test drones for making deliveries to customers in its parking lots and at customers’ homes, following the lead of Amazon and smaller companies seeking exemptions from government drone rules.
Walmart also wants to use the aerial technology to check on its buildings, warehouses and distribution centers.
The retail giant applied to the Federal Aviation Administration for an exemption from current regulations Monday.
Walmart has tested drones inside its facilities but now wants to do outdoor tests. To do that, it needs FAA permission to operate “small unmanned aircraft systems,” as the industry calls drones.
Walmart is using drones in an effort to create a more efficient supply chain, company spokesman Dan Toporek says.
“You test for a reason,” he said, “because you learn during tests and you tend to evolve and figure out which approaches are most compelling to customers and most efficient for the business.”
Toporek says Walmart is ready to start outdoor tests immediately if the FAA gives approval.
The approval process typically takes 120 days, said Michael Drobac, executive director of the Small UAV Coalition, a drone industry group.
Multiple other companies, including Amazon and Flirtey, a drone delivery startup based in Nevada, also are exploring how to conduct deliveries via drone. Through Oct. 22, the FAA has granted 2,020 permits for commercial drones for purposes such as aerial photography, pipeline inspection and agricultural monitoring.
Enough Signatures Collected
To Force Carlsbad Field Referendum
City News Service
A planned upscale retail and dining center that would overlook the Agua Hedionda Lagoon in Carlsbad is likely headed to voters after opponents announced Tuesday that they collected enough valid petition signatures.
The group Citizens for North County formed to oppose a plan by Los Angeles open-air shopping mall developer Caruso Affiliated that would result in the shopping and dining center, but also preserve 85 percent of about 203 acres of open space near Interstate 5 and Cannon Road. Much of the property has been used for decades to grow strawberries.
The company contends the project will maintain most of the open space and allow the popular farming operation to continue.
The Carlsbad City Council approved the project, which allowed it to bypass the normal environmental review. The citizens group wants voters to make the decision.
With backing from the Sierra Club of San Diego, League of Women Voters and local chapter of the Surfrider Foundation — among other organizations — Citizens for North County collected 9,100 signatures, which were submitted to the Carlsbad city clerk last month.
A little over 6,500 needed to be valid. With that threshold met, the City Council will have to decide whether to place the question on a regularly scheduled 2016 election ballot, call a special election, or repeal its approval of the project, city officials said.
Port Invites Bids for Harbor Island
The Port of San Diego is inviting redevelopment proposals for a 44-acre site on Harbor Island, including nine acres currently entitled for a 500-room hotel.
Proposals could include hotels, retail development, restaurants and maritime-related projects. Proposals are due by Dec. 29.
The land on Harbor Island is currently in use by three rental car companies that are preparing to relocate to a new rental car center next year, the Harbor Police Department headquarters and aviation-related industry.
Rep. Peters and Republican
Colleague Launch Life Sciences Caucus
Times of San Diego
Democratic Rep. Scott Peters reached across the aisle to join Rep. Leonard Lance of New Jersey to launch a congressional caucus focused on the life sciences.
“The life sciences are driving innovative breakthroughs that are saving lives and changing the face of medicine in our country,” said Peters. “It is my hope that we can use this caucus to bring experts from across the country to D.C. as we work to make informed public policy decisions.”
On Capital Hill, a caucus of like-minded legislators can help draft legislation focused on specific issues or industries that Congress as a whole does not follow.
The San Diego life sciences community quickly applauded the move, with Biocom and the California Life Sciences Association issuing supporting statements.
“California Life Sciences Association commends Reps. Scott Peters and Leonard Lance on the creation of the Congressional Life Sciences Caucus, which will help strengthen the dialogue in Congress over the issues affecting the life sciences sector,” said Sara Radcliffe, president and CEO of the association.
Peters represents the 52nd District of California which covers much of central San Diego, including the La Jolla area where many new biotech companies are located. Lance represents a district in New Jersey that is home to many pharmaceutical companies.
Excellence in Journalism Awards
Freelance writer Delle Willett won a first place award in the San Diego Press Club’s 42nd annual Excellence in Journalism Awards last night for a story on Asset-Backed Loans in the April 2015 issue of SD METRO Magazine. The award was in the Magazines, Business & Financial category.
Willett’s story described a new source of capital gaining in popularity — asset-backed loans. Personal-asset lenders take personal luxury assets like gold, jewelry, classic cars and the like as collateral for a short-term personal or business loan.
Freelance writer Thomas Shess took home a second place award for an architecture story for the North Park News, and a third place award for a travel story, also in the North Park News.
Shess penned the winning design feature for May 2015’s “C Street Panorama,” a Richard Requa designed vintage home in South Park owned by the Schoeffel family. Shess was singled out for his June article “North Park to Cuba” feature in North Park News.
Veteran writer, Shess has 14 Press Club Awards for Architecture & Design from the San Diego Press Club, however it was his first award in travel writing.
Bing Crosby Season is Back at Del Mar
This fall marks the second annual Bing Crosby Season at Del Mar where the “Sport of Kings” gets a glamorous, old Hollywood twist. The 20-day session will bring world-class along with a sprinkling of seasonal events including festivals, free concerts, giveaways and eclectic outdoor dining options.
Opening Day Hollywood Fashion Contest — Thursday, Oct. 29. Dress up categories include: Most Glamorous, Best Dressed Couple, Best Celebrity Look-Alike or Famous Character. Participants entering will have a chance to compete for more than $3,000 in prizes.
The Bing Crosby Season runs through Nov. 29. Racing Thursday-Sunday with post time for the first race at 12:30 p.m. on most days. On Thanksgiving Day first post is shifted to 11 a.m. For more information, call (858) 755-1141 or visit www.delmarscene.com.