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A growing seniors population and increasing prevalence of high-cost diseases like diabetes has generated a surge in funding for healthcare research in recent years and, along with it, demand for life science-biotech lab space.

But the biggest impact on demand for wet lab space has resulted from mapping of the complete human genome and subsequent advances in biotechnology, according to Ian Anderson, director of research and analysis with real estate services firm CBRE. Anderson notes that the price for sequencing a human genome has dropped from $100,000 to just $1,000, resulting in massive expansion in DNA research and development of new biotech tools, like the CRISPR gene editing system.

“This ‘gold rush’ of information is providing the pharma industry the ability to tailor treatments to individuals and actually cure diseases, not just diagnose them and treat symptoms,” Anderson says.

As a result, lab space vacancy in the top three life science markets—Boston, the San Francisco Bay Area and San Diego—averaged between 4.0 and 6.0 percent at the end of 2017, the most recent period for which data is available, according a report from real estate services firm CBRE. In certain submarkets, including the Bay Area’s Peninsular and Emeryville/Berkley markets, Cambridge, Mass. and San Diego’s Torrey Pines, vacancy ranged between 0 and about 2.5 percent, respectively.

With ongoing high demand, vacancy and upward rent momentum have strengthen even further since the report was released, according to Anderson.

Tight vacancy is generating new construction in the San Francisco Bay Area and Boston-Cambridge markets, as well as growing life science markets, including Chicago and the Raleigh-Durham Research Triangle. San Diego is seeing significant new construction too, as well as redevelopment of office and industrial buildings for life science and biotech research and development.

These three markets have received the lion’s share funding from both the National Institutes of Health (NIH) and venture capital (VC) firms. According to the California Life Sciences Association, the state’s life science and biotech companies were awarded $3.8 billion in NIH grants in 2017 and attracted $6.7 billion in VC investment. The Massachusetts Biotechnology Council reported that Massachusetts life science and biotech companies were awarded $2.7 billion in NIH grants in 2017 and attracted $3.6 billion in VC investment.

“The life science sector is seeing record levels of IPO and funding activity,” says Greg Bisconti, Cushman Wakefield executive director who heads the company’s life science practice nationally. A third quarter 2018 Cushman Wakefield report notes that fundraising, IP, and merger and acquisition (MA) activity are at an all-time, with Big Pharma playing a significant role in MA and driving significant growth in all major biotech hubs.

The boom in funding has ratcheted up competition for talent and facilities, setting off a “war for talent” among life sciences companies, notes Bisconti.

“There’s a lot of hiring and organic growth of companies, but every company is limited by talent available,” he says. “When building and growing a life sciences company, key talent is being selective about the job opportunity and their future workplace, which highlights that companies need to secure quality space in which to grow talent.”

Alexandria Real Estate Equities is taking advantage of this environment to promote its Alexandria Center for Life Science in New York City, which currently consists of two 15-story towers with 728,000 sq. ft. of space. Alexandria’s New York City cluster focuses on recruiting life science tenants to the city, including the unique business units of international pharma companies and serial entrepreneurs. It also nurtures start-ups, seed-stage academic spin-outs and growing early-stage companies, having established Alexandria LaunchLabs, a life science start-up incubator, and the Alexandria Seed Capital Platform, a funding model catalyzing seed-stage life science investment.

More patents are coming out of the New York life science cluster than San Francisco and Boston combined, according to John H. Cunningham, executive vice president and New York City regional market director at Alexandria Real Estate Equities. With both U.S. and European life science companies establishing beachheads in the city, Alexandria recently announced plans for expansion of the life science cluster, which is located on 3.5 acres in Manhattan’s Eastside Medical Corridor near New York University’s academic medical center and Bellevue Hospital. The company also acquired two nearby properties that will be redeveloped for its life science and biotech tenants.

The addition of the 550,000-sq.-ft. North Tower will bring total space at the Alexandria Center to approximately 1.3 million sq. ft. The building will provide collaborative space for scientists, as well as start-up space.

The company also acquired the 593,000-sq.-ft. Pfizer building at 219 East 42nd St. and a 177,000-sq.-ft. industrial building in Long Island City, both of which will be redeveloped. “We’re building an ecosystem that will allow growing companies to remain within our platform. People want to stay here with peers because it helps them grow and flourish,” says Cunningham.

CBRE’s Anderson notes that Los Angeles is producing a lot of STEM talent as well, and there is building momentum for a cluster around Harbor-UCLA Medical Center in the South Bay-Torrance area and life science and biotech companies located around UCLA and in the San Fernando Valley and Thousand Oaks areas. For now, however, many life science and biotech tenants want to be close to where collaboration and scientific breakthroughs are happening (San Francisco Bay Area, Boston-Cambridge or San Diego), Anderson notes.

As for the sector’s future, “There will be dip in the industry when an economic downtown occurs,” he says. “But money is still plentiful, and the long-term trajectory for this sector is pretty bright.”

Article source: https://www.nreionline.com/medical-office/expansion-dna-research-driving-strong-demand-life-science-space-united-states

Article source: https://www.bloomberg.com/news/articles/2018-10-23/boise-and-reno-capitalize-on-the-california-real-estate-exodus

Anyone who’s dreamed of a nice little piece of land in Marin County overlooking the bay may finally have the chance.

All it’ll take is $110 million — that’s the asking price — and a stomach for legal battles.

The land, called Easton Point, is a 100-acre chunk of open space on a hillside above fabled Paradise Drive in Tiburon. For four decades, owners, neighbors, lawyers and county officials have battled one another over plans to develop it.

It’s said to be the most expensive property ever offered in Marin County. On Friday, it goes on the market.

“This is an amazing opportunity for a qualified buyer,” said real estate agent Lydia Sarkissian, who is representing the Tiburon family that has owned the property for 50 years. “It’s an undulating hillside paradise with endless vistas, golden meadows and breathtaking ridgelines.”

A qualified buyer, she added, should ideally “be worth about $1 billion,” although she would consider showing Easton Point to people of slightly lesser means, but not much lesser.

Along with the breathtaking ridgelines, whoever buys Easton Point will doubtless be acquiring more than a few headaches. Plenty of nearby residents have strong feelings about what happens to it, said Tiburon Town Manager Greg Chanis. The land has been the subject of planning debates and litigation for decades.

The owners’ decision to put the property on the market this week comes three months after a federal judge ruled against them over their development plan.

Sarkissian acknowledged the tract’s litigious history, which will doubtless continue if a new owner persists in plans to subdivide the land.

“The family just wants to sell it and move on,” she said. “In Marin County, people complain about everything. Neighbors will complain if you want to put a new roof on your house.”

Although Easton Point lies just outside Tiburon city limits, the town and a local citizens group have united to challenge efforts to subdivide or develop the property. Chanis said Tiburon would like to see it remain empty, as is, without 42 houses on it.

“We recognize that it’s privately owned, but ideally we would like to see the land preserved as open space,” he said. “This has been on the town’s radar for decades, and the final status has yet to be determined. It’s the subject of active litigation.”

Sarkissian said the current owners would be very happy if a single buyer chose to build a single house on it. That would end the controversy, she surmised. She did point out that, for $110 million, no house is included. Easton Point is empty. Building a house would run an additional $50 million or so, Sarkissian said, because such a house would require “a 10-car garage and several swimming pools and a bocce court” to do the property justice.

Such a buyer, Sarkissian said, would probably be “one of those big high-tech guys” who, like the proverbial yacht buyers, do not need to ask the price, even one that runs nine figures.

At $110 million, the price is reasonable, Sarkissian said. Prospective buyers should call her right away, because a deal this good may not last long.

Would-be buyers must prove the ability to come up with $110 million before Sarkissian will drive them through the two locked gates and onto the property in her Range Rover, the obligatory transport of Marin real estate agents. In other words, no lookie-loos.

“The buyer of Easton Point will not just be well-to-do,” she said. “The buyer will possess wealth that’s beyond just being rich.”

Steve Rubenstein is a San Francisco Chronicle staff writer. Email: srubenstein@sfchronicle.com Twitter: @SteveRubeSF

Article source: https://www.sfchronicle.com/bayarea/article/Want-100-acres-overlooking-San-Francisco-Bay-All-13334246.php

The California housing market posted its largest annual sales decline since March 2014 in September, as home sales fell below the 400,000-level benchmark for the second consecutive month. This indicates that the market is slowing as potential buyers appear to be putting their homeownership plans on hold, according to the California Association of Realtors.

Closed escrow sales of single-family homes in California totaled 382,550 units in September, down 4.3 percent from the revised 399,600 level in August and down 12.4 percent from 436,920 home sales in September 2017. Meanwhile, the statewide median home price dropped to $578,850, down 2.9 percent from $596,410 in August, but up 4.2 percent from a revised $555,400 in September 2017.

Realtor officials point to high home prices, rising interest rates, and the new tax reform law as reasons keeping buyers on the sidelines. “The housing market continued to deteriorate and the decline in sales worsened as interest rates remained on an upward trend,” explained C.A.R. president Steve White. “Tax reform, which increases the cost of homeownership, also is contributing to the decline, especially in high-cost areas such as the San Francisco Bay Area and Orange County.”

Price appreciations have slowed in the last few months and inventory has risen considerably since June when the statewide median price hit a new peak, according to Leslie Appleton-Young, C.A.R. senior vice president and chief economist. Appleton-Young noted, “Buyers are becoming increasingly concerned about market developments and are reluctant to purchase at the prevailing market price. As such, the deceleration in price growth will likely continue in coming months.”

Sales in the San Francisco Bay Area declined 16.4 percent from September 2017, the largest decline since October 2010. Santa Clara County posted the largest drop at 22.6 percent. Home sales there were down 22.2 percent from August.

Other counties experiencing year-over-year double-digit sales declines were Sonoma (-19.4 percent), Solano (-19.3 percent), Contra Costa (-17.3 percent), San Mateo (-14.6 percent), Napa (-14.2 percent), San Francisco (-11.5 percent), and Alameda (-10.4 percent). Marin County experienced the lowest decline at 1.1 percent.

While home prices continue to grow in the Bay Area, C.A.R. reports the rate of appreciation has slowed since the first half of the year. In September, the median price in the Bay Area increased 9.8 percent from last year, lower than the average year-over-year growth rate of 14.9 percent. Three counties showed double-digit median price growth from the previous year: San Mateo (14.2 percent), San Francisco (11.7 percent) and Marin (11.6 percent). In Santa Clara County, the median home price of $1,250,000 in September was up 5.9 percent from $1,180,000 in September 2017 and down 3.5 percent from $1,295,000 in August.

Statewide active listings rose for the sixth consecutive month, increasing 20.4 percent from the previous year. September’s listings increase was the biggest in nearly four years. The Bay Area had the largest increase in active listings, with a surge of 44 percent year over year. In Santa Clara County, active listings more than doubled (+113 percent) from September last year.

“We’ve always said real estate is a cycle and while we’re not concerned about a downturn, this shift in the market indicates buyers may have more negotiating power now than a year ago,” said Bill Moody, president of the Silicon Valley Association of Realtors.

At the same time, Moody cautions about timing the market. “The time to buy or sell is the right time for you, what’s best for your situation and for you family,” said Moody.

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Article source: https://www.mercurynews.com/2018/10/26/its-official-californias-housing-market-experiencing-shift/

A sprawling parcel of land sitting on one of the choicest spots overlooking San Francisco Bay comes with a $110 million price tag and a catch: Any buyer also inherits two groups of disgruntled local residents, one of which is demanding the land’s walking trails be opened to the public.

Known as Easton Point, the 110-acre parcel is located at the southern tip of the Tiburon Peninsula, which is located about 17 miles from downtown San Francisco. The hilly property boasts views of the San Francisco skyline, the Golden Gate…

Article source: https://www.wsj.com/articles/a-110-million-bay-area-property-offers-viewsand-some-unhappy-neighbors-1540403645