The donation that turned into a million-kroner business

On 1 May the former hospital buildings were handed over to FEAS, which will spend the next few years turning them into a new campus area, the University City.

The first many years of the foundation’s now 75-year history funds came exclusively from Cheminova. Since the mid-1980s activities have expanded to also include significant real-estate activities in FEAS and increasing efforts within innovation, business development and knowledge exchange in Alexandra Instituttet A/S, INCUBA A/S and CAPNOVA A/S.

By Helle Horskjær Hansen

The Aarhus University Research Foundation was founded when a CEO donated all his shares in his own company to Aarhus University. His name was Gunnar Andreasen, and the company was Cheminova. It was 1944, and at the time the shares were worth DKK 300,000. Today this sum of money would have been worth DKK 6.5 million. Now, 75 years later, the total assets of the Aarhus University Research Foundation amount to DKK 4.7 billion. A good deal? Yes, and right from the start focus has been on creating the best possible foundation for providing financial support to scientific research at the university. And it appears to have been a success.

According to the foundation’s strategy, its aim is to ensure that the foundation remains evergreen, while creating the best possible foundation for increased grant levels. The foundation’s asset management must facilitate this by ensuring that its capital is invested as wisely as possible with regard to return and risk. The main purpose in placing the foundation’s assets in portfolio companies is for them to provide a good return. In addition, it is the foundation’s hope that the activities of these companies will contribute to strengthening scientific research at Aarhus University, e.g. via infrastructure, research-based innovation and commercial exploitation of scientific research.

INTRODUCING REAL-ESTATE
To begin with and up until 1986 – the year Cheminova was listed on the stock exchange – the foundation’s funds were dominated by its shares in Cheminova. In 1957 the foundation’s share capital had increased to DKK 3 million, and it had a net worth of DKK 3.7 million. The research foundation was one of the majority shareholders in the company by the time of Cheminova’s stock exchange listing in 1986, but subsequently the capital situation changed: The listing introduced a number of new class B share owners, and the foundation sold for DKK 25 million class B shares, freeing up capital.

A year after the stock exchange listing, in 1987, the foundation founded Forskningsfondens Ejendomsselskab A/S, also called FEAS. The objective was to purchase, build, let out and manage buildings on own or leased land in Denmark. Mainly for research purposes or research-affiliated or research-related activities, as stated in the objects clause. FEAS’ current balance sum is DKK 1.6 billion, and FEAS thus plays a main role in the foundation. The real-estate company owns and manages more than 115,000 square metres in 40 properties mainly located in Katrinebjerg and the Nobel Park.

MONEY FOR BULK BUYING
When Cheminova was sold to the American FMC Corporation for DKK 8.5 billion, the foundation owned 38.55 per cent of the company and thus got DKK 3.2 billion from the sale. This money has played a significant role in FEAS’s purchase of the former Aarhus Kommunehospital for DKK 807.5 million. And at the time of the handover in May 2019, the company’s assets will be worth around DKK 2.5 billion. The sale of Cheminova, among other things, also spurred the foundation to establish AUFF Invest, which is charged with managing its liquid assets. In addition to real-estate, the foundation focusses on developing innovation environments and businesses, especially within the subsidiaries Alexandra Instituttet A/S, INCUBA A/S and CAPNOVA A/S.

FORSKNINGSFONDENS EJENDOMSSELSKAB
The Aarhus University Research Foundation founded Forskningsfondens Ejendomsselskab, FEAS, in 1987.

The company’s first job was to act as developer on the first permanent buildings in the research park on Gustav Wieds Vej. Subsequently, the company purchased dorm rooms and flats for visiting researchers and students, including Vennelyst Kollegiet, Teknolog Kollegiet and later the flats for visiting scientists in the Nobel Park, among others.

The real-estate company was further developed and used as a tool in the university’s development plans, and in time the company has been charged with purchasing areas in the neighbourhoods surrounding the university park to support its position as a city university. Among other things, the company built the Nobel Park and large parts of the IT campus Katrinebjerg, and in 2018 it had a turnover of DKK 130 million, which is its best result so far with a profit of DKK 72 million. 

On 5 January 2016 a historically large real-estate deal was signed in Aarhus, when FEAS purchased the hospital buildings on Nørrebrogade – the former Aarhus Kommunehospital – from the Central Region Denmark. Together with Aarhus University, FEAS will turn the buildings into a new campus area. The purchase added just over 100,000 square metres to its real-estate portfolio. Initially, Aarhus University will lease part of the site and the appertaining buildings. The property was handed over to FEAS on 1 May 2019.

ALEXANDRA INSTITUTTET A/S, INCUBA A/S, CAPNOVA A/S, PARKKOLLEGIERNE A/S AND AARHUS UNIVERSITY PRESS
The Aarhus University Research Foundation has made it its business to develop businesses and innovation environments. The subsidiaries Alexandra Instituttet A/S, INCUBA A/S, Parkkollegierne A/S, Aarhus University Press and CAPNOVA A/S, a so-called associated company, are examples hereof.

ALEXANDRA INSTITUTTET A/S
The Alexandra Institute is a privately owned company founded in 1999 and active within IT-related research, development and innovation for the purpose of creating financial growth, welfare and value. The institute establishes collaborations between research and industry, research-based knowledge services, professional networks, courses, conferences and network services. Since 2007 the Alexandra Institute has been able to call itself an Approved Technological Service Institute. The Aarhus University Research Foundation has owned the institute since 2012.

INCUBA A/S
In 1984 the City of Aarhus first introduced the idea of establishing a research park in Aarhus, taking the first steps towards INCUBA. The idea was to inspire researchers to start their own businesses, something which had not been done in Denmark before. Over six months they managed to get a series of companies, institutions and organisations interested in the project, and in 1985 the association Foreningen Forskerpark i Aarhus was founded. The Aarhus University Research Foundation has been a fellow shareholder right from the start, and FEAS was involved in the construction. In 2006 the IT building INCUBA – Innovation Network Centre for University and Businesses of Aarhus – opened in Katrinebjerg welcoming 62 companies. In addition to its presence in Katrinebjerg, INCUBA also has offices at Navitas and in Skejby, and today INCUBA hosts almost 200 businesses, mainly within the fields of IT, health and cleantech.

CAPNOVA A/S
Since 1998 CAPNOVA has acted as a state-approved innovation environment appointed by the Ministry of Higher Education and Science. On behalf of the state, the innovation environments invested risk capital in new innovative businesses, but in May 2018 the Government and Danish People’s Party decided to phase out the innovation environment programme. This means that as of 2019 CAPNOVA can no longer invest state funds in innovative entrepreneurs, though it will continue to cooperate with the more than 100 companies with which it has already established collaborations.

PARKKOLLEGIERNE A/S
The colleges in the Aarhus University Park have housed students since 1935 and are some of the oldest colleges in Aarhus. The colleges resemble the majority of the buildings in the University Park in design, and students at Aarhus University still live in the buildings. In 2014 the self-governing institution Kollegierne i Universitetsparken donated Parkkollegierne to the Aarhus University Research Foundation. The objective was to ensure that Parkkollegierne on a more solid and long-term foundation could continue to serve as attractive accommodation to students at Aarhus University.  

AARHUS UNIVERSITETSFORLAG A/S
The Aarhus University Press publishes close on 100 new books a year and holds just under 2,000 titles in stock, of which around 500 are in English. The press focusses on scientific literature as well as science-communicating publications and teaching material. Common to all publications is that they are rooted in strong professional expertise. The press’ first job is to disseminate and render visible research at Aarhus University. The foundation took over the Aarhus University Press in 2013 with a view to securing research dissemination at Aarhus University.