Regardless of what type of glasses you wear, 2013 appears to have been a momentous year for the life sciences in Massachusetts. Science was advanced and new patients served with the approval by the U.S. Food and Drug Administration of three novel drugs of Massachusetts companies: Genzyme’s Kynamro, which treats a rare form of high cholesterol; Biogen Idec’s Tecfidera, a best-in-the-class treatment for relapsing multiple sclerosis; and Sunovion’s Aptiom, which treats seizures associated with epilepsy.
It was a resurgent year for investment. Venture capital financing for Massachusetts biotechs rose to nearly $900 million and it appears that medical device companies in Massachusetts may surpass the historic high funding levels of 2012, at over $450 million. An incredible nine Massachusetts biopharma companies – Acceleron, Agios, Bind, Bluebird, Enanta, Epizyme, Foundation, Karyopharm, and Tetraphase – went public with IPOs and raised over $840 million in 2013. On the heels of several recession years in which no IPOs took place in the industry globally, it is a notable feat.
On the real estate end, the year was nothing short of epic. In Cambridge, the new 400,000 square foot Novartis complex was topped-off, as was Pfizer’s neighboring 180,000-square-foot building. Just blocks away, Biogen Idec’s two buildings on Binney Street and at 17 Cambridge Center – over half a million square feet combined – reached final construction stages. The 390,000-square-foot Alexandria Center’s frame rose on Binney Street and the gleaming new Broad Institute lab building on Ames Street neared its completion. Back on Massachusetts Avenue, Forest City broke ground for a lab building of 250,000 square feet that will house additional space for Millennium – The Takeda Oncology Co. Across the river in Boston, the 1.1 million-square-foot Vertex project at Fan Pier also neared completion and Alexandria Real Estate’s 350,000-square-foot Longwood Center was topped off. Beyond 128, PerkinElmer expanded its life sciences campus in Hopkinton, Synageva added over 50,000 square feet in Lexington and Bristol-Myers Squibb announced its plans to expand its Devens campus with 200,000 additional square feet of new research space.
Expanding From Within
Movement within established space was also robust. Both Boston Scientific and Quest Diagnostics moved headquarters to Marlboro campuses, while, in substantial deals, Foundation Medicine, Sarepta, Epizyme, Boston Biomedical, and Momenta secured spaces totaling over 320,000 square feet in Cambridge and Sanofi cut the ribbon at its new cancer research hub at the venerable 640 Memorial Drive building in September. In the suburbs, IntelligentMDx and uniQure landed in Waltham and Lexington, respectively.
At the close of 2013, according to CBRE-New England’s Greater Boston BioView, Massachusetts lab space stood at over 21 million square feet.
It’s an impressive situation, coming as it does after years in which global industry consolidation and restructuring was the rule. While the pre-recession swagger of the biopharma industry may never quite fully return, 2013 will at least be remembered as the year in which the wind filled the industry’s sails once again.
How will the new chapter of 2014 read? Perhaps much like 2013. There are certainly no assurances that the Dow Jones will rise by 26 percent as it did in 2013, but investors still appear primed for new life science opportunities. Several Massachusetts drug development companies have entered the queue for IPOs this year. While a successful VC fundraising round or IPO does not necessarily result in a facility expansion or relocation, for the foreseeable future the lab market nonetheless presents more opportunities rather than less for lab users. The Vertex move to Boston will open up much of its current 800,000 square feet spread across Cambridge, from Cambridgeport to Kendall Square, to prospective new users. As construction continues at Alexandria Center and Longwood Center, it is with the knowledge that these grand new spaces have tenant commitments currently for just half of their space. In the suburbs and beyond, additional property owners and developers have entered the life sciences marketplace. Back in Cambridge, the 670,000 square foot One Kendall Square complex, the birthplace of the biotech industry, has just been acquired by DivcoWest, another new player on the lab development scene.
At a time of renewed investment in the life sciences, life science lab users may well find a lab market in 2014 as favorable as it has been in years.
Peter Abair is director of economic development and global affairs at the Massachusetts Biotechnology Council (MassBio).
