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Feature Story: It’s boom time for life science real estate

Panelists discuss the sector’s remarkable growth during recent BOMA MOB conference

By John B. Mugford

The life science sector is dominated by the country’s top clusters, which most professionals involved in the space agree include 13 primary markets, with 10 others emerging as up-and-coming clusters, the firm’s Ian Anderson told BOMA MOB conference viewers. (HREI photo)

Think the medical office building (MOB) sector is holding up well during the COVID-19 pandemic? (As most professionals involved in the sector are aware, it most certainly is.)

But one somewhat related real estate sector, that involving life science facilities, is not only doing well but continuing to grow substantially and see demand for space above and beyond what the current supply can satisfy.

“Demand for lab space and employment growth in (the country’s top life science markets) continues to exceed supply and, as a result, we are beginning to see development in markets where we haven’t seen development in many years,” said Ian Anderson, senior director of research with CBRE Group inc. (NYSE: CBRE).  “What’s driving this growth … is really the biotechnology research and development (R&D) segment.”

This message of growth came by way of a panel session examining the life science real estate sector during the recent BOMA International Medical Office Buildings & Healthcare Real Estate Conference held on Nov. 4-5. Like most conferences taking place since the onset of the pandemic, the 2020 BOMA MOB conference was an online event this year.

The session was titled “The Science of Health: A Look at the Booming Life Sciences Asset Class.” The panel was moderated by Ryan Egli, a senior VP with CBRE specializing in life science facility leasing and sales. Also on the panel were: John Cox, senior VP and regional market director with Pasadena, Calif.-based Alexandria Real Estate Equities (NYSE: ARE), a real estate investment trust (REIT) that owns a portfolio of more than 32 million square feet of life science facilities; Mike Dorris, senior VP focused on life science properties with Irvine, Calif.-based Healthpeak Properties Inc. (NYSE: PEAK); and Jamie Peschel, managing partner with Boston-based Longfellow Real Estate Partners, which invests in the sector.

Mr. Anderson added that venture capital funding of life science and biotech research companies

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