A joint venture of Boston Properties and Alexandria Real Estate Equities has signed a tenant for its entire upcoming life science project in South San Francisco. Part of a multi-phase development, the seven-story building is expected to become operational in 2024.
The two REITs announced the partnership in January last year. Under the agreement, the companies combined their ownership of life science assets in the area, including land for future development. The envisioned campus is planned to total 1.7 million square feet. Boston and Alexandria each own an approximately 50 percent stake in the venture.
According to a recent Kidder Mathews report on the Bay Area life sciences market, the tenant is Genentech, one of the biggest names in biotech. The company signed for 229,000 square feet, or the entire building under construction at 751 Gateway Blvd., within the venture’s Gateway Commons—a six-building campus planned to total 1.1 million square feet, including existing properties.
Gateway Commons is situated within a short distance from Caltrain and the Bayshore Freeway (101), which provides direct access to San Francisco. Some 2 miles north, at Oyster Point, another massive, 3-million-square-foot life sciences project is under construction by Kilroy Realty Corp.
Genentech already has a presence of approximately 4.7 million square feet within its 207-acre campus. According to a Master Plan submitted to the City of South San Francisco in 2019 and approved last year, the biotech giant is set to grow its presence to over 9 million square feet, adding 12,500 new jobs.
Vacancy rates for life science space in San Mateo County reached 2.6 percent by the end of the third quarter, down by 50 basis points since the second one, the same Kidder Mathews report shows. According to CommercialEdge data, South San Francisco has over 2 million square feet of office space underway, virtually all of it dedicated to life science use. Among other large developments, Healthpeak Properties’ announced last month it will build a $393 million campus. Its first phase, named Vantage, will offer 343,000 square feet when it comes online in 2023.