Kilroy Realty Corp. has secured a tenant for more than half of the total space at its 656,000-square-foot office development in the city of South San Francisco. Stripe, a tech company that makes software for credit card payments over the internet and is valued at $35 billion, inked a 12-year lease at Phase 1 of Kilroy Oyster Point.
With the 421,000-square-foot lease, the first phase of Kilroy’s Oyster Point development is now 100 percent leased. Over the summer, the firm signed biopharmaceutical company Cytokinetics to a 235,000-square-foot lease at the $600 million project. Kilroy Chairman & CEO John Kilroy said in a statement that strong demand and limited supply in the market led to the project leasing up quickly.
Located at the intersection of Oyster Point and Marina boulevards, about 11 miles south of downtown San Francisco, the 2.5 million-square-foot development spans across a 40-acre site that Kilroy acquired in June 2018. Construction of the first of four phases of the project began earlier this year in March. Phase 1 is set to comprise three lab and office buildings, which are slated to be completed in the second half of 2021. Upon completion, Stripe will move 10 miles south of its current South of Market headquarters.
Designed by DGA Architects to be LEED Gold certified, Phase 1 is being built by Hathaway Dinwiddie Construction and will include all new streets, bay trail improvements, pedestrian lanes and sidewalks. Teichert Construction is in charge of utilities. All three buildings within Phase 1 will be within walking distance of the ferry terminal and will be visible from major thoroughfare Highway 101. The overall project will include more lab and office properties, eventually comprising 11 buildings in total.
A growing sector
The life sciences market has been exploding over the last several months, with major commercial real estate players entering the sector and launching new divisions. Earlier this month, LaSalle Investment Management made its debut into the life sciences arena with the purchase of a majority interest in a 793,000-square-foot property in San Diego.
In April, New York City-based real estate firm Thor Equities made its leap into life sciences, launching Thor Sciences, a division of the company that specializes in the sector. The firm made its first acquisition at the time of the announcement, paying $152 million for a life sciences campus in Bridgewater, N.J.