JLL released the 2017 Life Sciences Outlook. Highlights for Northern and Central New Jersey include:
- Prism Capital Partners closed on its purchase of the former Roche Clifton/Nutley research campus, which will allow the developer to redevelop the 116-acre site with a mix of commercial, retail and residential components. The new Seton Hall-Hackensack Meridian School of Medicine signed a 25-year lease to occupy two buildings totaling 477,151 square feet on the campus.
- Allergan leased a 431,495-square-foot office building at 5 Giralda Farms in Madison for its new U.S. headquarters. The Dublin-based pharmaceutical company was awarded a 10-year, $58.2 million Grow New Jersey award to consolidate its Bridgewater, Jersey City and Parsippany offices to Madison.
- Mallinckrodt Pharmaceuticals leased 233,000 square feet at 1405 and 1425 Route 206–Somerset Financial Center in Bedminster.
- Consolidations by Valeant Pharmaceuticals led to 310,000 square feet being placed on the market for sublease at Somerset Corporate Center III in Bridgewater. This availability represented the largest block of sublease space in the Route 78 Class A market.
- Russo Development is under contract to purchase Merck & Co’s former 1 million square foot research campus at 1011 Morris Avenue in Union. Transit-oriented luxury rentals, restaurants and retail components are expected to be included in the redevelopment plans for the property.
- While Bristol-Myers Squibb announced a phased closure of its Hopewell site by mid-2020, the drug maker plans on investing in the development of new facilities in Lawrenceville and New Brunswick.
Several rising trends that may impact real estate decisions and strategy in life sciences clusters include:
- The divesting and acquiring of business lines will continue to lead to the disposition of space and offer opportunities for small and mid-sized firms to grow their footprint in vacancy deprived clusters.
- All signs are pointing toward further industry growth, which will mean increased demand for space. With lack of availability already an issue, asking rents for lab space will continue to rise, particularly in premier clusters.
- As companies key in on retaining and attracting talent, urban lab space and amenitized suburban campuses will be the focus of the next generation of lab development.
- With institutional capital beginning to pour into the top markets, the next tier of clusters, such as Philadelphia and Seattle, will likely receive more interest from investors.
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