Focus

U.S. life sciences industry still expanding, just not as quickly as 2020-2021

Commercial Observer – April 5

According to a new CBRE report, the cumulative lab space in the 13 largest U.S. life sciences markets has expanded by 47% in the past five years to 181.7 million square feet. CBRE forecasts that figure will jump another 22% in the next two years to 220 million square feet, with almost a third of the space currently under construction already preleased. CBRE’s 2023 outlook also points to a growing number of clinical trials for new drugs, persistent job growth, surging federal financing, and ample cash reserves for the industry’s larger companies. Life sciences investment sales are down to pre-pandemic levels, but sales volume dropped 43% year-over-year to $14.4 billion in 2022. A flurry of mergers and acquisitions is expected this year as valuations for smaller companies fall, CBRE reported.

News

HSBC plots Silicon Valley push

Banking Exchange – April 17

HSBC’s U.S. arm has hired a quartet of former Silicon Valley Bank (SVB) senior leaders as it seeks to fill the gap left by the collapse of SVB last month. The bank’s parent company bought SVB’s UK arm in the wake of the US bank’s collapse, and is now aiming to provide business banking services to technology, healthcare, and life sciences firms among others. SVB was closed by the California state regulator on March 10, transferring the business to the Federal Deposit Insurance Corporation. Much of the business was subsequently sold to First Citizens Bank, which stated its intention to build on SVB’s focus on private equity, venture capital, and technology.

Medical office building mergers, acquisitions up 14% in Q1

Becker’s ASC Review – April 14

Medical office building mergers and acquisitions were up 13.7% in the first quarter of 2023 and up 5% from the same period last year. Medical office building spending increased by 21.3% over the last quarter, hitting $991 million in the first quarter, according to data released by LevinPro HC. Tennessee saw the highest number of mergers and acquisitions in quarter one with 11 deals, followed by California, Illinois, Florida, and Texas.

VC investment in life science sector is healthy, but slowing

Commercial Property Executive – April 3

Although venture capital funding in the life science sector fell 28.2% in 2022, the industry “is better prepared to withstand upcoming volatility as there is still elevated interest in life sciences and dry powder sitting on the sidelines,” according to a new report from Savills Research and Data Services. How much dry powder? Consider this: Among just the VC funds that have entered the life science sector since 2020, six have more than $1 billion each on hand: SoftBank Latin America Fund, Addition, Seven Seven Six, Colchuck, Anthos Capital, and March Capital.

Deals

Tarlton buys industrial site in Union City for life science makeover

The Real Deal – April 14

Tarlton Properties aims to revamp a 3-acre industrial site it has acquired in Union City for life science uses. The Menlo Park-based developer paid $10.75 million for neighboring parcels at 33589 Central Avenue and 33288 Alvarado-Niles Road, with plans for a life science conversion, the San Francisco Business Times reported. Union City is working to engage private developers like Tarlton to transform its aging warehouses “for higher and better uses,” Carmela Campbell, the city’s economic and community development director, said.

Graymark buys Thousand Oaks office for life sciences conversion

Connect CRE – March 16

Graymark Capital has acquired 120 Via Merida, a 99,000-square-foot office building in Thousand Oaks. The San Francisco-based company paid $17.75 million for the property and also secured $42 million in financing for the acquisition and speculative conversion of a life sciences campus.

Life science development approved in San Carlos

The Daily Journal – March 22

A new 105,416-square-foot office and research lab space proposed on the east side of San Carlos was approved by the city’s Planning Commission Monday, making it one of many life science facilities coming to the city’s Innovation District. Alexandria Real Estate, the developer behind the proposal at 888 Bransten Road, plans to build a new three-story life science building on the 2.42-acre lot where a single-story auto repair shop sits.

DPR tops out life sciences tower in Seattle

Construction Dive – April 3

DPR Construction has topped out its 12-story Eleven50 Eastlake life sciences project in Seattle. The 450,000-square-foot facility includes mission-critical lab and office space with retail on the ground floor. Construction began in January 2021 and is scheduled to be completed this year.