Lab demand shrinks in life sciences real estate market, putting keys in hands of smaller biotech companies

Fierce Biotech – September 19

Boston, the San Francisco Bay Area, and San Diego are once again the top markets for life sciences commercial real estate in the U.S., with plenty of opportunities for growth as biotech readies for a comeback, according to a new JLL report. At the end of 2021, demand among the top eight U.S. markets added up to 25 million square feet. That has now shrunk to just over 10 million square feet by mid-2023. As the larger industry underwent a correction, smaller biotech firms have been scrambling for lab space throughout this year, becoming the largest seekers of new space, according to the report. JLL said that 82% of deals in the first half of the year came in under 30,000 square feet, compared to the previous average of 65%.

News

How biotech IPOs performed in the third quarter

BioPharma Dive – October 3

Initial public offerings may slowly be coming back to the biotechnology sector. Eight biotech companies priced IPOs from July through the end of September, raising $1.1 billion in total, according to data compiled by BioPharma Dive. That compares to four in the second quarter, which brought in about $580 million. (Kenvue, J&J’s consumer division, also completed an IPO in May as part of a spinout.) Still, for the most part, newly public drugmakers aren’t enjoying rising valuations like many that held IPOs in 2020 and 2021 did.

Megaproject boom squeezes supplies for life sciences construction

Construction Dive – October 2

The megaproject boom is not only ripping away a chunk of the labor pool from other projects, but also much-needed materials, according to a report from Cushman & Wakefield. For example, contractors in the life sciences sector report lead times increasing from four weeks to nearly two years for materials such as generators, electrical switchgears, electrical panels, AHUs, and elevators, said Jason D’Orlando, senior managing director at Cushman & Wakefield.

Deals

Stockdale Capital Partners plans 145,000-SF medical office, life sciences project in West Los Angeles

REBusiness Online – October 3

Stockdale Capital Partners has announced plans for 656 S. Vincente Boulevard, a medical office and life sciences property in Los Angeles’ Golden Triangle area. The project will be the first new medical office and life sciences building constructed in the area in more than 20 years. Core-and-shell completion is slated for October 2026.

Alloy Properties delivers office-to-life science conversion in San Diego

Commercial Property Executive – September 6

Alloy Properties has completed the redevelopment of Elements, a three-building, 290,000-square-foot life science campus in San Diego’s Sorrento Mesa submarket. The developer, an affiliate of TPG Real Estate Partners, started the conversion of offices to laboratory space after the $104 million purchase of the property in March 2020.

Second phase of Fremont life science campus unveiled

Connect CRE – September 26

HED has unveiled the design for the second phase of Perceptive Real Estate Equities, Inc.’s Ardenwood Innovation and Life Sciences Center expansion in Fremont. It adds a 75,000-square-foot facility to the existing 100,000-square-foot built-to-suit for cancer genomics company Personalis, Inc., which occupied its corporate headquarters and laboratory facility last October.

San Diego Science Research Park: a game-changer for innovation and collaboration

Hoodline – September 26

The University of California Regents approved the ambitious Science Research Park development at UC San Diego. According to UC San Diego News Center, the project is destined to revolutionize research by fostering corporate, non-profit foundation, and academic partnerships. Wexford Science & Technology will take the lead on the development, spanning over 23 acres. According to the project plan, the development will occur in two phases over the next decade.

Recently acquired Westlake Labs life science campus to grow lab and office space

L.A. Business First – September 5

A seven-acre life science campus in the Conejo Valley’s Westlake Village is adding 35,000 square feet of speculative lab and office space after being acquired for $18 million earlier this year. The 100,000-square-foot Westlake Labs campus, purchased earlier this year by Argosy Real Estate Partners and Graymark Capital's life sciences branch Gray Matter, is giving the life science industry deeper roots in the Conejo Valley, where a biotech hub has been steadily forming for years.

Construction tops out for San Carlos life science property

S.F. YIMBY – September 25

Construction has reached the third floor at 1030 Brittan Avenue in San Carlos. The development is the third location in the city for MBC BioLabs and Dewey Land, close to their second location at 930 Brittan Avenue. Dewey Land purchased the site in early 2022 for $20 million.

Dallas lands $2.5B federal biotech and life science hub

D Magazine – September 27

Dallas will be home to one of three regional hubs for the Advanced Research Projects Agency for Health (ARPA-H), a new federal agency established by the Biden administration to accelerate health outcomes by developing high-impact solutions to challenging health issues. The announcement reflects North Texas’ growing reputation as a national biotech and life science development leader. Earlier this year, the agency announced it would choose three locations to serve as regional hubs, and ARPA-H announced Tuesday that Dallas would be home to the Customer Experience Hub to support the $2.5 billion independent federal agency.