TORONTO – Major Canadian insurance firms are investing $290 million in MaRS Discovery District, repaying the bulk of its loans from the Ontario government nearly three years ahead of schedule. Manulife Financial Corp, Sun Life Financial Inc and iA Financial Group led the financing deal by investing in 19-year bonds issued by Phase II Investment Trust, the innovation hub.
MaRS Discovery District, which focuses on areas including health sciences and technology, is a startup incubator and a part of Ontario’s efforts to drive innovation and attract entrepreneurs. But, for years, the Liberal government was criticized by the province’s Conservative party for the “bailout” loans it provided MaRS.
MaRS began construction on a 20-story building in 2007 to significantly expand the innovation hub, but the project stalled when the financial crisis hit and the center struggled for years to find enough tenants to fill the space.
The tower was left in limbo until 2011 when the province of Ontario provided the non-profit with a $224 million loan to help finish construction. It was the first of multiple government loans totalling some $395 million.
The building is now fully leased and will soon generate enough money to be self-sustaining, MaRS’ chief executive Ilse Treurnicht said in a statement.
More than 140 research labs and companies occupy the 1.5 million square-feet (139,000 square-meter) MaRS complex, which provides support for startups and research in areas including finance, health, and cleantech.
Tenants include Facebook, IBM and Royal Bank of Canada, and ventures within the hub’s network employ over 5,200 people, MaRS said.