A digital financial technology company, Seven Stars Cloud Group, plans to move its global headquarters for technology and innovation to the former UConn campus in West Hartford, Gov. Dannel P. Malloy announced Tuesday.
The New York company led by a Chinese billionaire plans to bring 330 jobs to the nearly 58-acre campus over the next five years, Malloy said. Under the deal, Seven Stars Cloud would purchase the property from UConn for $5.2 million.
The now-empty college campus would become a “thriving center for research, training and business development,’’ Malloy said at a state Capitol press conference with Bruno Wu, executive chairman and CEO of Seven Stars. UConn will consider the sale of the property at a special meeting on Friday. The town of West Hartford must also approve the project.
“We will use our best efforts to deploy some of the best technologies worldwide,’’ Wu said. “Hartford has always been part of the financial capital. The digital economy is about to take over.”
He said the company plans a $283 million tech hub for blockchain technology and artificial intelligence. “We are going to be creating a lot of jobs and at the same time making at lot of investments,’’ Wu said.
The announcement came a day after Malloy and executives from Stanley Black & Decker announced a $1 billion project creating a high-speed data center in New Britain that may add as many as 2,500 jobs in coming years.
In West Hartford, the state will provide a $10 million loan to Seven Stars Cloud Group as an incentive, and the money would be used for renovating and retrofitting existing buildings on campus. If certain job targets are reached, the loan could be forgiven and turned into a grant.
The loan would be provided under Malloy’s sometimes-controversial “First Five’’ program that is now projected to expand to 20 companies. Seven Stars Cloud would be the 18th company to receive assistance under the program, which has been hailed by Malloy but criticized by some Republicans as a giveaway to profitable companies.
A blockchain is a digital public ledger of all digital transactions. The most recent transactions, or blocks, are recorded and added in chronological order, allowing those who participate in a financial market — buyers and sellers — to track digital transactions without central record keeping. It was originally developed as an accounting method for the virtual currency bitcoin.
Christopher Day, a former Aetna and Cigna employee, has been preaching the blockchain gospel for more than a year as a Connecticut-based business adviser for RapidQube, an Indian software company. He tries to get American companies to adapt to the technology and use it to modernize how they do business.
Day said the United States is still catching up to regions of the United Kingdom and Asia that embrace software powered by blockchain.
While he was unfamiliar with Seven Stars Cloud, Day said he was glad to see Connecticut making an investment in the technology itself.
“Here in the U.S., (major companies) are still doing the wait-and-see thing,’’ he said. “But as blockchain becomes more accepted, more incorporated into how people are looking at their business, it’s going to become second nature.”
Day added, though, that any large software company in the state will likely need to partner with the University of Connecticut or other colleges to find enough talent in a relatively small field.
He estimates that skilled blockchain software developers and architects could demand salaries of more than $100,000.
“They’re very expensive in the market, and very rare,” he said. “That’s going to be a large cost of business.”
UConn business professor David Noble, director of the Peter J. Werth Institute for Entrepreneurship and Innovation, said he was familiar with the company and looking to learn more about their business model.
There is untold potential to develop platforms and networks powered by the ultra-secure, ledger software, but it’s a tall task. Noble says legacy tech companies like IBM are allocating massive resources to the problem already.
If a Connecticut company could create a new, successful blockchain product for businesses, “it would be globally recognized as one of the first successful platforms,” Noble says.
Wu said the five existing buildings in West Hartford would be retrofitted for use by Seven Stars Cloud. The company is already dealing with architects to plan the future of the sprawling site.
“The campus is beautiful — a beautiful piece of property,’’ said Wu, an American citizen. “The campus will be more like a public park.’’
UConn spokesperson Stephanie Reitz said lawyers for UConn and Seven Stars Cloud have “agreed in principle,” but a formal vote by the board of trustees is scheduled for Friday.
West Hartford Town Manager Matthew Hart said the town has not received formal plans for the project, but that he thinks the development will be “received quite positively.” The proposal would require a zoning change and building permits.
Hart said Seven Stars Cloud is not likely to generate as much traffic as the site did when it was a college campus. The former campus, located on Trout Brook Drive near Albany Avenue, is zoned for single-family residential uses. UConn had a special-use permit which allowed for the school.
“What we’re talking about here could be a draw for our region and brings benefits to the region,” Hart said.
West Hartford’s council waffled on purchasing the property — originally priced at $5 million, then dropped to $1 million after toxic PCBs were found on site in October 2016. The university was later cited by the state Department of Energy and Environmental Protection for moving slowly on cleanup and remediation. Reitz said under the purchase and sale agreement, Seven Stars Cloud would assume environmental cleanup of the site.
West Hartford has spent roughly $462,000 while it considered purchasing the property throughout most of 2017 — a $250,000 nonrefundable deposit to UConn when it initially considered purchasing the property and about $212,000 to consulting company Milone & MacBroom for environmental testing, research and community outreach work.
According to a study compiled by Cheshire-based Milone & MacBroom, West Hartford residents living near the campus said they were more in favor of a town park. They indicated a split reaction to the parcel being used to build an assisted living or an indoor commercial recreation facility and were opposed to commercial development there — such as professional or medical offices, retail or a hotel, according to the report.
Deputy Mayor Beth Kerrigan said the project “sounds promising and I’m keeping my fingers crossed.”
“It’s not just good for West Hartford, but good for all of Connecticut,” Kerrigan said.
Mayor Shari Cantor, a member of the UConn board of trustees, declined to comment Tuesday.
Town councilor Dallas Dodge, who chairs a town council economic development committee said: “I think it’s very positive that West Hartford is so attractive to international, new technology businesses like this.”
Rhona Free, President of the University of St. Joseph, said the university is looking forward to collaborating with its new neighbor.
“As their neighbor and key community contributor, this is exactly what West Hartford and the region needs to spur growth and innovation,” Free said.
Residents weren’t consulted about the property until February — nearly a year after councilors planned to move ahead with the purchase. Town staff hosted a community forum seeking feedback from the hundreds of residents who attended. They said they wanted to see as much green space preserved as possible and that they wanted that space to be open to the public. Those sentiments reflected the results of a two-week survey of nearly 2,700 people.
On social media Tuesday, residents showed support for the new tech company.
Gerry Butch Aldrich posted on Facebook: “Excellent – as long as they keep the property clean and bring revenue in, it’s better than what it’s being used for now.”
Gretchen Levitz said she lives in the Bishops Corner neighborhood and drives by the property everyday. She posted on Facebook: “New jobs, renovated and cleaned up property, tax payer, it’s a win win !”
Courant staff writers Christopher Keating, Rebecca Lurye and Stephen Singer contributed to this story.