Focus

Life sciences VC funding drops 28% in 2022

Commercial Observer – February 23

Despite a strong start last year, venture capital funding for life sciences totaled $35.8 billion in 2022, down 28% from 2021, according to Cushman & Wakefield (C&W). Initial public offering activity also fell 90% from $14.5 billion in 2021 to $1.4 billion in 2022. The San Francisco Bay Area accounted for $12.6 billion, or 35%, of the total venture capital funding in the U.S. last year, followed by Boston at $8.5 billion and San Diego with $2.5 billion. Los Angeles also saw a notable spike in later-stage funding, up 92% from 2021. Looking forward, C&W estimates that VC capital will become more conservative, but also noted that dry powder for life sciences increased to $290 billion at the end of third quarter last year, up 24% from 2021.

News

Terasaki Institute opens new biomedical incubator on L.A.’s Westside

Los Angeles Business Journal – February 27

A new bioscience incubator is opening on L.A.’s Westside. It was set up and will be operated by the Westwood-based Terasaki Institute for Biomedical Innovation, a nonprofit research foundation founded by a former UCLA professor and organ transplant pioneer. Terasaki’s incubator joins several others in the county, including Biolabs at the Lundquist Institute in Torrance, ScaleHealth in Palms, and Biospace LA at California State University Los Angeles in El Sereno.

Growth in outpatient care spurs demand for medical office

Connect CRE – February 9

While representing just 30% of the U.S. population, the 55-plus populace is the biggest consumer of U.S. healthcare services, and the 80-plus cohort is forecasted to balloon nearly 50% in the next 10 years. The growth of the elder population in the U.S., longer life expectancies, and better healthcare delivery are all fueling demand for outpatient healthcare services and facilities, reinforcing medical office as one of the most stable asset classes, says JLL.

Deals

Genentech expanding at 60-acre Oceanside campus

San Diego Business Journal – March 6

Genentech has broken ground on a $280 million manufacturing plant on its Oceanside campus. With the addition of the new building, Genentech will have seven buildings totaling 575,000 square feet on its 60-acre Oceanside campus. The new Oceanside manufacturing operation will mirror Genentech’s Clinical Supply Center in South San Francisco that opened in August 2022, enabling fast transfer of technology between the two sites.

Prologis to build San Francisco life science campus

Commercial Property Executive – March 3

Prologis intends to develop a two-building, 550,000-square-foot office and laboratory campus on three adjacent properties it owns in South San Francisco, San Francisco Business Times first reported. The firm has submitted an application with the city, seeking to merge the sites, which total 4.7 acres, and replace the existing warehouses with two eight- and 10-story buildings, alongside a nine-story, 827-space parking garage. The plots are south of 100 E. Grand Ave., another Prologis parcel where the firm plans to build a recently entitled 600,000-square-foot life science campus.

SDSU Mission Valley: Developer picked to build office, labs

The San Diego Union-Tribune – March 6

San Diego State University has picked LPC West to erect the first three office buildings at the school’s Mission Valley campus. The developer and the university will likely execute early next year, following approval from the California State University Board of Trustees, a long-term ground lease for a portion of the Mission Valley campus reserved for office buildings, or what the school is calling an innovation district. The two larger buildings will cater to life science firms and feature wet lab space. The third, smaller building will serve as an amenity and co-working space. The developer plans to incorporate mass timber as a design element.

Avia Labs breaks ground in Millbrae

San Mateo Daily Journal – March 2

The city of Millbrae and Longfellow Real Estate Partners recently celebrated the groundbreaking of Avia Labs at Millbrae Station. The new 315,000-square-foot Class A lab and office project will replace a former vacant storage facility with the first all-electric life science campus in California.

Palo Alto life sciences campus breaks ground

Connect CRE – March 3

BentallGreenOak and Gray Matter by Graymark Capital have begun construction on phase one of Bayshore Bio, a 100,000-square-foot life sciences campus in Palo Alto. The first phase will convert an existing office building into a two-story, 36,000-square-foot facility with market-ready lab spaces, upgraded electrical capacity, new office space, and dedicated parking. The campus will be designed for early-stage VC-backed life science companies.