2022 March Life Sciences Update

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2022 MARCH

Life Sciences Update North American Report

Contents

Summary

Summary

02

Funding Remains Strong

03

The life sciences industry has been on the rise over the past half-decade thanks to a surge in new products and technology, as well as an influx of capital from both public and private investors. The last two years, in particular, have seen tremendous growth with $70 billion of private equity (PE) capital and public National Institutes of Health (NIH) funding pouring into life sciences-related companies in North America in 2020 and a record $78 billion in 2021. Building off the momentum of last year’s successful implementation of the mRNA technology, opening the door to new treatments for diseases like cystic fibrosis, cancer and HIV, the industry is poised for another successful year in 2022.

This 2022 Q1 U.S. Life Sciences Update breaks down the current trends in the life sciences industry at a high level by exploring: 1. Where the capital is flowing; 2. Where the talent can be found; and 3. The impact on the lab space market (i.e., demand, cost and new construction). The report also contains a market-by market analysis that provides detailed overviews of some of the largest life sciences markets in the U.S.

Talent is on the Rise

07

Sector Growth = Increased Demand for Lab Space Market-by-Market Analysis

09

12

Boston

13

New Jersey

14

New York City

15

Philadelphia

16

Raleigh / Durham

17

San Diego

18

San Francisco Bay Area

19

Suburban Maryland (I-270 Corridor)

20

Appendix

21

2 / CUSHMAN & WAKEFIELD

LIFE SCIENCES 2022 MARCH UPDATE

Even though NIH funding declined for the first time since 2014, 2021 funding—$33.5 billion— still outpaced pre-pandemic levels by 7.8%. It continues to be weighted towards the largest markets, with the top 10 markets accounting for half of all U.S. funding. In addition, PE funding increased by 29%, exceeding $44 billion, and PE and public offering investment in life sciences companies has been just over $86 billion since the pandemic began. Funding Remains Strong

3 / CUSHMAN & WAKEFIELD

LIFE SCIENCES 2022 MARCH UPDATE

Funding Remains Strong

Top Markets in NIH Funding for the Previous Five Years (2017-2021)

Boston

$14.2B

New York City

NIH Funding Down in 2021 by 4.1% Total Annual U.S. NIH Funding over Time

Half of NIH Funding Goes to 10 Markets Share of Annual NIH Funding in Top 10 Markets

$11.3B

San Francisco Bay Area Baltimore / Suburban MD (I-270)

$9.0B

$40

NIH Funding - U.S.

$20

52%

$35.0

$35

$8.5B

$16

50%

Raleigh / Durham

$30

$33.5

$7.3B

$25

$12

48%

Seattle

$5.9B

$20

Billions

Los Angeles

$8

46%

Billions

$15

$5.8B

Average Annual Growth Rate 1995-2021: +5.5% 2016-2021: +6.2%

Philadelphia

$4

44%

$10

$5.5B

$5

San Diego

$0

42%

$4.9B

$0

Chicago

Funding in Top 10 Markets

Share of U.S. Funding (rhs)

$4.4B

Houston

Source: U.S. National Institutes of Health, Cushman & Wakefield Research

Source: U.S. National Institutes of Health, Cushman & Wakefield Research

$3.7B

Pittsburgh

$3.2B

Even though total U.S. NIH funding declined by 4.1% YoY in 2021, it was the second highest year on record (7.8% above 2019). In fact, even with the decline, the growth in funding over the past five years has averaged +6.2% per year, which is faster than the 26 year average dating back to 1995 (+5.5%). The downward trend is likely attributed to a one-year blip—the NIH’s 2022 budget request included an increase of $9 billion in total program spending, of which over 80% is “awarded for extramural research.”

Half of NIH funding in the U.S. is allocated to the top 10 markets led by Boston, New York City and the San Francisco Bay Area. Over the past five years, the NIH distributed $76.8 billion to organizations located in just 10 U.S. markets. These are also the cities with the fastest growing life sciences labor pools and the most dynamic lab real estate markets.

Ann Arbor

$3.0B

St. Louis

$2.8B

Atlanta

$2.6B

Source: U.S. National Institutes of Health, Cushman & Wakefield Research

4 / CUSHMAN & WAKEFIELD

LIFE SCIENCES 2022 MARCH UPDATE

Funding Remains Strong

Investment in Biotech up 12.7% YoY North American Venture & Public Offering Capital

30 Largest Transactions Over the Past Two Years Life Sciences VC & Public Capital Invested in 2020 & 2021

Private Equity (PE)

Public Offerings

Company Name Royalty Pharma

Size (MM)

Date

Type

C&W Market New York City Wilmington, NC

$45

1

$2,180 $1,863 $1,620 $1,338 $755 $668 $588 $570 $551 $548 $525 $525 $506 $500 $500 $500 $493 $483 $451 $436 $424 $420 $400 $390 $368 $350 $340 $336 $330 $325

Jun 2020 Feb 2020 Nov 2020 May 2020 Oct 2020 Dec 2020 Feb 2021 Jan 2021 May 2020 Jun 2020 Mar 2021 May 2020 Sep 2020 Jun 2020 May 2020 May 2020 Mar 2020 Dec 2020 Oct 2020 Apr 2021 Jun 2020 Apr 2020 Jul 2020 May 2020 Mar 2021 Jul 2020 Sep 2020 Apr 2021 Aug 2020 Jan 2020

Public Public Public Public

2 3 4 5 6 7 8 9

Pharmaceutical Product Development

$40

Maravai Life Sciences Moderna Therapeutics

San Diego

Boston

$35

Resilience

VC

San Diego New Jersey

$30

Certara

Public Public

Sana Biotechnology

Seattle Boston

$25

EQRx

VC

MyoKardia

Public Public

SF Bay Area New Jersey

$20

Billions

10

Catalent

11

ElevateBio

VC

Boston

$15

12 13 14 15 16 17 18 19

Iovance Biotherapeutics

Public Public

SF Bay Area SF Bay Area

$10

10x Genomics

Indigo Agriculture

VC

Boston Boston Boston

$5

Insulet

Public Public

Bluebird Bio

$0

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Lyell

VC

SF Bay Area Vancouver New York City Salt Lake City

AbCellera

Public Public Public Public Public Public

Source: PitchBook

Everest Medicines

20

Recursion

21

Legend Biotech Immunomedics

New Jersey New Jersey

22 23 24 25 26 27 28 29 30

Unsurprisingly, biotechnology investment exploded during the pandemic with biotechnology PE and public offering investment in North America exceeding $45.7 billion in 2021. Between 2020 and 2021, $86.3 billion was invested ($78.8 billion in PE and $7.5 billion in public offerings), which exceeded the combined four-year total between 2016 and 2019 ($82.3 billion). The largest deal in 2021 was Seattle-headquartered Sana Biotechnology’s IPO that raised $588 million. The next two largest deals—and half of the top 10 deals— were for companies headquartered in Boston.

Relay Therapeutics

Boston

GRAIL

VC

SF Bay Area

Instil Bio Zymergen

Public

Dallas

VC VC VC

SF Bay Area SF Bay Area

RBNC Therapeutics Adagio Therapeutics

Boston

Schrödinger

Public Public

New York City

Blueprint Medicines

Boston

Source: PitchBook

5 / CUSHMAN & WAKEFIELD

LIFE SCIENCES 2022 MARCH UPDATE

Funding Remains Strong

Life Sciences Investment by Region In 2021, the top markets for life sciences VC investment remained the same as the previous year: Boston, San Francisco Bay Area, San Diego and New York City—accounting for $41.3 billion in 2021. There were 29 completed deals for at least $250 billion, of which 20 were VC funding rounds and nine were IPOs. Three-fourths of those large deals occurred in just four markets: Boston (11), San Francisco (7), San Diego (3) and New York City (2).

Life Sciences VC & Public Capital Invested by Region, 2021

$6.6B San Diego

$3.1B New York City

$52.4B Total

$1.4B Washington DC Metro

$18.0B Boston

$2.1B Seattle

$0.8B Salt Lake City

$0.9B New Jersey

$0.2B Montreal

$0.7B Toronto

$1.5B Philadelphia

$0.7B Denver

$13.6B San Francisco Bay Area

$0.4B Vancouver

$0.8B Chicago

$1.1B Los Angeles

$0.5B Raleigh / Durham

Source: PitchBook

6 / CUSHMAN & WAKEFIELD

LIFE SCIENCES 2022 MARCH UPDATE

Talent is on the Rise

Life sciences employment has continued to fare better than the U.S. job market with YoY growth up 7.9% and 11.4% in 2020 and 2021, respectively. Since 2011, total U.S. employment growth has averaged 1.0% per year while life sciences employment has increased by 6.6% per year, on average. The top 10 life sciences MSAs account for 45% of the U.S. life sciences talent pool led by Boston, NYC-NJ, San Francisco, Philadelphia and San Diego.

7 / CUSHMAN & WAKEFIELD

LIFE SCIENCES 2022 MARCH UPDATE

Talent is on the Rise

Markets with the Largest Talent Pool Life Sciences Total Employment and Labor Pool by Market (MSA), 2021

Life Sciences Job Growth Accelerated in 2021 Second Largest YoY Growth (+11.4%) in past 30 Years, Behind only 2018

Sacramento Indianapolis St. Louis

San Diego DC Metro Los Angeles Seattle Chicago Raleigh-Durham Houston Baltimore Minneapolis Dallas Portland, OR Salt Lake City Madison, WI Miami Pittsburgh Detroit Atlanta Denver

Employment: R&D in Biotechnology Industry

Employment Growth by Decade (Average Annual)

Total Employment (U.S.)

Life Sciences (U.S.)

300

7%

6.6%

275

267

6%

250

5%

225

4%

200

Boston San Francisco Bay Area New York City-New Jersey Philadelphia

Thousands

175

3%

0 10 20 30 40 50 60 70 80 90

150

2.0%

2%

Thousands

1.7%

Source: Emsi

125

1.0%

1%

0.5%

100

0.0%

0%

The top 10 markets account for 45% of the U.S. life sciences talent pool (including current employment and labor pool). This percentage is up from 42% over the past five years, illustrating that job growth continues to be concentrated in these top markets. Labor pool growth in the top 10 markets is up 19% since 2016 and the next tier of markets (#11-20) have increased a similar amount over the past five years (+16%). After that, however, growth is anemic with all other markets accounting for just 3.3% growth since 2016. Major life sciences hubs will continue to be drivers of life science and lab real estate with employment and funding trends also boding well for real estate growth in emerging markets around the country.

1991-2001

2001-2011

2011-2021

Source: U.S. Bureau of Labor Statistics

Source: U.S. Bureau of Labor Statistics, Cushman & Wakefield Research

Unlike the broader economy, life sciences employment did not falter during the pandemic. Instead, there was only one month of job losses (April 2020 declined by 0.1%) and year-end job growth was up 7.9% YoY in 2020 and 11.4% in 2021.

8 / CUSHMAN & WAKEFIELD

LIFE SCIENCES 2022 MARCH UPDATE

Sector Growth = Increased Demand for Lab Space

Growth in the life sciences sector has directly translated into increased demand for lab space across major markets. Coupled with strong capital flows, life sciences companies have increased their footprint in most markets, driving up rents and increasing occupancies. This uptick has attracted more jobs and more talent to the sector as evidenced by the growth of employment. Investors are trying to keep up with this demand in 10 key U.S. markets with the current robust construction pipeline totaling 17.1 million square feet (msf).

9 / CUSHMAN & WAKEFIELD

LIFE SCIENCES 2022 MARCH UPDATE

Sector Growth = Increased Demand for Lab Space

Correlation between Talent & Lab Space Life Sciences Inventory & Employment Pool, Select U.S. Markets

Growth in Life Sciences Markets Under Construction Space & Projected Growth in Labor Pool

Lab Space: Current Inventory & Under Construction

Projected Growth in Labor Pool & Lab Inventory

50

Current Inventory Under Construction U/C as % of Inventory

16%

San Francisco Bay Area

45

SF Bay Area

50%

60

New York City

14%

40

50

40%

12%

Boston

35

Raleigh-Durham

40

10%

30

30%

San Diego

Seattle

30

Suburban MD

8%

Boston

25

MSF

20%

Suburban MD

20

San Diego

20

6%

Philadelphia

10%

New Jersey

10

15

Raleigh/Durham Life Sciences Inventory (MSF)

New Jersey

4%

Philadelphia

10

0%

0

Chicago Forecasted Labor Growth (2021-2025) 2%

Los Angeles

Denver

Seattle

5

Chicago

0%

New York City

0%

10%

20%

30%

40%

0

0

20

40

60

80

100

Under Construction as % of Current Inventory

Employment Pool (Thousands)

Source: Emsi, Cushman & Wakefield Research

Source: Cushman & Wakefield Research

Source: Esmi, Cushman & Wakefield Research

There is, of course, a correlation between the depth of the employment pool and the life sciences inventory in each market. Across these 12 markets, the average inventory-to-talent ratio is 462 sf. Several Western markets—as well as Raleigh-Durham—have higher ratios above 600 sf: San Francisco Bay Area, San Diego and Denver. Chicago is the only market with a ratio below 250 sf per potential worker. Boston has the largest labor pool and its inventory is scheduled to grow the most with over 9.6 msf of lab space currently under construction.

The 10 featured U.S. life sciences markets currently have 17.1 msf of lab space under construction. This represents 10.7% of current inventory. Currently, Boston (9.6 msf), San Francisco Bay Area (2.9 msf) and San Diego (2.3 msf) have the most construction in the pipeline. Although starting from a lower basis, double-digit increases in inventory are coming for New York City (26%), Chicago (14%) and Philadelphia (10%). New lab space is needed, especially in tight markets with sub-6% vacancy rates (e.g., San Diego, Philadelphia and Boston).

10 / CUSHMAN & WAKEFIELD

LIFE SCIENCES 2022 MARCH UPDATE

Sector Growth = Increased Demand for Lab Space

Lab Space Fundamentals Select U.S. Markets

Lab Share as % of Office Inventory Select U.S. Markets

Life Sciences: Current Rent & 6-Year Growth

Life Sciences: Vacancy Rate, Q4 2021

25%

Rent

Rent Change 2015-2021 (right hand side)

Seattle Boston Los Angeles Suburban Maryland

120%

$120

20%

100%

$100

80%

$80

New York City Denver Chicago Raleigh/Durham New Jersery San Francisco Bay Area San Diego Philadelphia

60%

$60

15%

40%

$40

20%

$20

10%

0%

$0

5%

0% 5% 10% 15% 20% 25% 30% 35%

*Philadelphia rent change is from 2017 to 2021

0%

Source: Cushman & Wakefield Research

Since 2015, lab space asking rents have increased by an average of 72%, led by rates that more than doubled over that time in the San Francisco Bay Area and Raleigh-Durham. The life sciences market is tight with vacancy below 10% in six of the largest U.S. markets: San Diego, Philadelphia, Suburban MD, Seattle, Boston, and Los Angeles. And even with a large pipeline of new space, strong pre-leasing along with forecasted sector and employment growth, will keep vacancy rates low in most major markets.

Source: Cushman & Wakefield Research

11 / CUSHMAN & WAKEFIELD

LIFE SCIENCES 2022 MARCH UPDATE

Market-by-Market Analysis

12 / CUSHMAN & WAKEFIELD

LIFE SCIENCES 2022 MARCH UPDATE

Boston

Market Summary • Greater Boston has become an increasingly dominant center of the life sciences industry, with a continued regular international audience as well as an influx of scientists looking to contribute to the growing environment. • Nearly 15 msf of lab product is either under construction or in pre construction phases as the total inventory of lab product is likely to exceed 40 msf by 2025. • A lack of readily available developable land in Kendall Square, the biotechnology industry center, has led to the formation of new industry area hotspots, including Somerville’s Union Square, Boston’s Seaport District and numerous areas within Watertown. • Following a decrease in direct flights in 2020, daily direct air service to four continents has resumed from Boston Logan International Airport, an important connection for the highly collaborative life sciences industry. • Housing has emerged as a critical feature in complementing bio growth. In some cases, future occupants of under construction lab buildings have reserved units in nearby, under construction multifamily assets with planned delivery dates close to tenant occupancy.

Public & Private Funding (2021)

Rent vs. Vacancy Comparison

Fast Lab Stats 25.1 MSF Market Square Footage $87.93 $ Per SF 2.5% Vacancy 87.4K Total Life Sciences Employment & Talent Pool 239% Life Sciences Employment Growth Rate Since 2001

Company

Deal Type

Completed Type

$ Raised (MM)

$20 $30 $40 $50 $60 $70 $80 $90 $100

7%

EQRx

Early Stage

Jan 2021

VC

$570.0

6%

ElevateBio

Later Stage

Mar 2021

VC

$525.0

5%

Neumora

Early Stage

Oct 2021

VC

$400.0

Vacancy Rate

4%

XtalPi

Later Stage

Aug 2021

VC

$400.0

3%

Generate Biomedicines

Later Stage

Nov 2021

VC

$370.0

Adagio Therapeutics

Later Stage

Apr 2021

VC

$335.5

2%

Adagio Therapeutics

IPO

Aug 2021

Public

$309.4

1%

Average Asking Rent $/sf

$0 $10

Cardurion Pharma

Early Stage

Oct 2021

VC

$300.0

0%

Valo

Early Stage

Mar 2021

VC

$300.0

2015 2016 2017 2018 2019 2020 2021

Verve Therapeutics

IPO

Jun 2021

Public

$266.7

Asking Rents

Vacancy Rate

Representative Investment Sale Transactions (2021)

Address

Type

$ MM

RBA SF Date

Buyer

401 Park Dr, Boston

Office (will convert to Lab)

$944.2

973,145 Jan 2021

Alexandria Real Estate Equities

201 Brookline Ave, Boston

Lab

$539.0

510,116 Jan 2021

Alexandria Real Estate Equities

101 South St, Somerville

Lab

$478.3

289,000 Dec 2021

TPG Capital

Representative Life Sciences Companies

Life Sciences Talent Pool

135 Morrissey Blvd, Boston

Active Lab Conversion

$362.5

693,921 Aug 2021

Beacon Capital Partners

Talent pool includes life science professionals not currently employed in the life science sector

Company

Type

470 Atlantic Ave, Boston

Office (will convert to Lab)

$238.0

346,225 Dec 2021

Nan Fung Life Sciences

Biogen

HQ

36,426

2 Financial Ctr, Boston

Office (will convert to Lab)

$210.0

220,000 Aug 2021

Nan Fung Life Sciences

38,000

321 Harrison Ave, Boston

Active Lab Conversion

$154.3

233,901 Apr 2021

Biomed Realty Trust

bluebird bio

HQ

34,000

1 Canal Pk, Cambridge

Office (will convert to Lab)

$131.0

112,000 Jul 2021

Breakthrough Properties

Bristol Myers Squibb Regional HQ

550 Arsenal St, Watertown

Mall (will convert to Lab)

$130.0

260,867 Apr 2021

Alexandria Real Estate Equities

30,000

CRISPR Therapeutics

HQ

93 Worcester St, Wellesley

Office (will convert to Lab)

$111.5

270,000 Sep 2021

Beacon Capital Partners

Moderna Therapeutics HQ

26,000

Novartis

Regional HQ

Representative Lease Transactions (2021)

Average Annual Growth Rate 2001-2021: 3.5%

22,000 Number of Persons

Pfizer

Regional HQ

Company

Address

Size (SF)

New/Renewal

Type

Quarter

Landlord

18,000

Sanofi

Regional HQ

Prime Medicine

60 First St

124,000

New

Lab

Q4

Anchor Line

Tscan Therapeutics

880 Winter St

113,487

New

Lab

Q4

Boston Properties

Takeda Pharmaceuticals Regional HQ

2011

2017

2021

2012

2015

2013

2018

2019

2016

2014

2010

2001

2007

2020

2002

2005

2003

2008

2009

2006

2004

Kymera Therapeutics

AOTC 1

100,624

New

Lab

Q1

Alexandria Real Estate Equities

Vertex Pharmaceuticals HQ

Avencell

500 Forge St

55,776

New

Lab

Q1

Boylston Properties

Bio Degree-Awarding Institutions, Metro Area • Boston University • Fitchburg State University • Harvard University • MIT • Mount Wachusett Community College • Salem State University • Tufts University • University of Massachusetts Lowell

Curie Therapeutics

100 Forge St

40,000

New

Lab

Q4

Boylston Properties

Top NIH-Funded Institutions (2017-2021) $2.5B Massachusetts General Hospital $1.8B Brigham and Women’s Hospital $972M Harvard Medical School

RVAC Medicines

880 Winter St

37,202

New

Lab

Q4

Boston Properties

Biocytogen

300 Third St

35,000

New

Lab

Q4

Boston Properties

Alchemlab

1050 Winter St

25,000

New

Lab

Q4

Greatland Realty Partners

Abata Therapeutics

100 Forge St

23,600

New

Lab

Q4

Boylston Properties

Research Contributor Brendan Carroll brendan.carroll1@cushwake.com

Sources: Cushman & Wakefield Research, CoStar, National Institutes of Health (NIH), Emsi, Pitchbook

13 / CUSHMAN & WAKEFIELD

LIFE SCIENCES 2022 MARCH UPDATE

New Jersey

Market Summary • Life sciences companies continued to call New Jersey their home in 2021, a trend which has not waivered for quite some time. The highly-educated talent pool continues to motivate companies to expand within the state, along with an innovative ecosystem with top-rated research universities and a persistent pipeline of biotech start-ups. • As a cheaper alternative to some high-priced lab markets, the Garden State has recorded a rise in lab and R&D demand over recent years. • With the market tightening amid healthy activity, asking rents for life sciences space has risen markedly over the last two years. Compared to 2020, the average net asking rental rate has swelled by 12.2% to an all time high of $33.61 psf. • Investors remain extremely interested in purchasing life sciences facilities throughout the Garden State, especially fully leased assets. Institutional buyers such as Thor Equities, Harrison Street, and Lincoln Equities Group have all entered the life sciences marketplace in recent years.

Public & Private Funding (2021)

Rent vs. Vacancy Comparison

Fast Lab Stats 14.2 MSF Market Square Footage $33.61 $ Per SF 11.8% Vacancy 43.7K Total Life Sciences Employment & Talent Pool 141% Life Sciences Employment Growth Rate Since 2001

Company

Deal Type

Completed Type

$ Raised (MM)

$40

16%

Elusys

Grant

Dec 2021

VC

$350.0

$35

14%

Edda Technology

Later Stage VC Apr 2021

VC

$150.0

$30

12%

Modern Meadow

Later Stage VC Apr 2021

VC

$130.0

$25

10%

Vacancy Rate

Elucida Oncology

Later Stage VC Jan 2021

VC

$43.7

$20

8%

Claris Biotherapeutics

Early Stage VC Jul 2021

VC

$38.5

$15

6%

Flowonix

Later Stage VC Jan 2021

VC

$36.5

$10

4%

Starton Therapeutics

Early Stage VC Nov 2021

VC

$25.0

$5

2%

Average Asking Rent $/sf

Onkos Surgical

Later Stage VC Nov 2021

VC

$22.5

$0

0%

2015 2016 2017 2018 2019 2020 2021

Nuvectis Pharma

Early Stage VC Aug 2021

VC

$15.0

Neumentum

Early Stage VC Oct 2021

VC

$13.3

Asking Rents

Vacancy Rate

Representative Investment Sale Transactions (2021)

Address

Type

$ MM

RBA SF Date

Buyer

Representative Life Sciences Companies

170 Park Ave

Office

$47.0

147,125 Feb 2021

JLL Income Property Trust

86-90 Morris Ave

Office/Lab

$39.7

620,627 May 2021

Onyx Equities

Company

Type

Life Sciences Talent Pool

111 Ideation Way

High Tech/Flex/Lab

$36.8

163,990 Dec 2020

Harrison Street

Bristol Myers Squibb HQ, Research Facility

Talent pool includes life science professionals not currently employed in the life science sector

Johnson & Johnson HQ, Research Facility

Merck

HQ, Research Facility

Representative Lease Transactions (2021)

38,000

Bayer

HQ, Research Facility

Company

Address

Size (SF)

New/Renewal

Type

Quarter

Landlord

Regional Office, Research Facility Regional Office, Research Facility Regional Office, Research Facility

Pfizer

Wuxi Biologics

1 Cedar Brook Dr

90,000

New Lease

Office/Lab Q1

Eastern Properties

34,000

PMV Pharmaceuticals

1 Research Way

50,000

New Lease

Lab/R&D Q1

BioMed Realty Trust

Sanofi

HIKMA Pharmaceuticals

33 Technology Dr

49,539

New Lease

Office/Lab Q3

Atlantic Development

30,000

Novartis

26,783

CytoSorbents Corporation

305 College Rd E

48,511

New Lease

Office/Lab Q2

National Business Parks

NJ Biopharmaceuticals LLC

350 Carter Rd - Bldg 5

47,197

Expansion

Lab/R&D Q4

Equus Capital Partners

Novo Nordisk

Regional Office

26,000

NJ Biopharmaceuticals LLC

350 Carter Rd - Bldg 5

35,000

New Lease

Lab/R&D Q2

Equus Capital Partners

Teva Pharmaceuticals Ferring Pharmaceuticals

Regional Office, Research Facility

Number of Persons

Ascendia Phamaceuticals

661 Route 1 S

32,341

Expansion, Sublease Lab/R&D Q4

NJ Economic Development Authority

22,000

Average Annual Growth Rate 2001-2021: 1.2%

HQ, Research Facility

18,000

Top NIH-Funded Institutions (2017-2021) $326M Rutgers, The State University of N.J. $248M Princeton University $238M RBHS-New Jersey Medical School

2011

2017

2021

2012

2015

2013

2018

2019

2016

2014

2010

2001

2007

2020

2002

2005

2003

2008

2009

2006

2004

Bio Degree-Awarding Institutions, Metro Area • Rutgers University (New Brunswick) • Saint Peter’s University • William Paterson University • Princeton University

Research Contributor Jason Price jason.price@cushwake.com

Sources: Cushman & Wakefield Research, CoStar, National Institutes of Health (NIH), Emsi, Pitchbook

14 / CUSHMAN & WAKEFIELD

LIFE SCIENCES 2022 MARCH UPDATE

New York

Market Summary • New York City (NYC) is a rapidly growing recipient of life sciences investment capital, with venture capital funding climbing to $6.2 billion in 2021, a 52.6% increase over 2020. • Investors and developers worldwide continue to grow their presence in NYC as it has one of the most educated and diverse talent pools in the nation along with first class academic and medical institutions and premier venture capital ecosystems. • The life sciences industry has steadily expanded its footprint in NYC over the past several years with state and city incentives continuing to encourage developers to build labs for medical research. In 2021, the city government announced a doubling of its investment into the sector—$1 billion—to accelerate its growth: $430 million for new laboratory and incubator construction; $450 million for non-profit facilities; and $20 million for internship programs and start-up ventures. • NYC is continuing to expand its life sciences presence with 2.6 msf expected to be delivered within the next five years, including Alexandria Center’s North Tower, Deerfield’s 325,000 sf redevelopment of 345 Park Avenue South, and Taconic Partners’ 399,000 sf redevelopment of 125 West End Avenue.

Public & Private Funding (2021)

Rent vs. Vacancy Comparison

Fast Lab Stats 3.1 MSF Market Square

Company

Deal Type

Completed Type

$ Raised (MM)

35%

$120

Capsule Pharmacy

Later Stage VC Apr 2021

VC

$300.0

30%

$100

Immunai

Early Stage VC Oct 2021

VC

$274.0

25%

Footage $97 $ Per SF 32.8% Vacancy 58.2K Total Life Sciences Employment & Talent Pool 144% Life Sciences Employment Growth Rate Since 2001

$80

Immunai

Later Stage VC Dec 2021

VC

$204.0

Vacancy Rate

20%

Trialspark

Later Stage VC Sep 2021

VC

$159.5

$60

15%

Unite Us

Later Stage VC Mar 2021

VC

$150.0

$40

Paige

Later Stage VC Mar 2021

VC

$125.0

10%

HiberCell

Later Stage VC May 2021

VC

$114.4

$20

5%

Average Asking Rent $/sf

Elevation Oncology

IPO

Jun 2021

Public

$100.0

$0

0%

C2i Genomics

Early Stage VC Apr 2021

VC

$100.0

2015 2016 2017 2018 2019 2020 2021

Opentrons Labworks, Inc Later Stage VC Sep 2021

VC

$200.0

Asking Rents

Vacancy Rate

Representative Investment Sale Transactions (2021)

Address

Type

$ MM

RBA SF Date

Buyer

707 11th Ave

Office (will convert to Lab)

$95.0

160,000 Dec 2021

Beacon Hill Capital & Georgetown Co

$95.0 (plans to invest an additional $120.0M on conversion)

43-10 Court Sq

Industrial (will convert to Lab)

200,000 Dec 2021

Longfellow Real Estate Partners

Life Sciences Talent Pool

Representative Life Sciences Companies

Talent pool includes life science professionals not currently employed in the life science sector

Company

Type

NYU Langone

HQ

Representative Lease Transactions (2021)

38,000

Pfizer

HQ

35,059

Company

Address

Size (SF)

New/Renewal

Type

Quarter

Landlord

Mount Sinai

HQ

Mt. Sinai Icahn School of Medicine

787 11th Ave

165,000

New Lease

Office/Lab Q1

The Georgetown Company

34,000

Opentrons

45-18 Court Sq

95,000

New Lease

Office/Lab Q3

GFP Real Estate/ King Street Properties

Schrodinger

HQ

C16 Biosciences

619 W 54th St

19,000

New Lease

Office/Lab Q2

Silverstein/Taconic Partners

Flatiron Health

HQ

30,000

Black Diamond Therapeutics

430 E 29th St

18,120

New Lease

Office/Lab Q2

Alexandria Real Estate Equities

Imclone Systems LLC

HQ

Helaina

345 Park Ave S

18,000

New Lease

Office/Lab Q2

Deerfield Management

26,000

Opentrons

HQ

Average Annual Growth Rate 2001-2021: 0.7%

RegenLab USA

140 58th St (BioBAT)

15,000

New Lease

Office/Lab Q4

New York Economic Development Corp.

Roche

Research Facility

Immunai

430 E 29th St

12,288

New Lease

Office/Lab Q3

Alexandria Real Estate Equities

Number of Persons

22,000

Volastra Therapeutics

1361 Amsterdam Ave

10,000

New Lease

Office/Lab Q2

Janus Property Company

Intercept Pharmaceuticals, Inc. HQ

Hemogenyx

1361 Amsterdam Ave

10,000

New Lease

Office/Lab Q4

Janus Property Company

Kadmon

HQ

18,000

Envisagenics

30-02 48th Ave

7,500

New Lease

Office/Lab Q4

Alexandria Real Estate Equities

Top NIH-Funded Institutions (2017-2021) $2.5B Columbia University Health Sciences $1.9B New York University School of Medicine $1.9B Icahn School of Medicine at Mount Sinai

2011

2017

2021

2012

2015

2013

2018

2019

2016

2014

2010

2001

2007

2020

2002

2005

2003

2008

2009

2006

2004

Bio Degree-Awarding Institutions, Metro Area • Columbia University • New York University • Fordham University • City College of New York • New York Institute of Technology

Research Contributor Lori Albert lori.albert@cushwake.com

Reed Hatcher reed.hatcher@cushwake.com

Sources: Cushman & Wakefield Research, CoStar, National Institutes of Health (NIH), Emsi, Pitchbook

15 / CUSHMAN & WAKEFIELD

LIFE SCIENCES 2022 MARCH UPDATE

Philadelphia

Market Summary • Philadelphia continues to be a top life sciences market, with 2021 seeing steady gains across almost all metrics. • When compared with other top life sciences markets, the Philadelphia market presents cost advantages in terms of average salaries and lab rents. • Cell and gene therapy companies dominated the market share of growth and new transactions in R&D, HQ and manufacturing facilities with Century Therapeutics, Carisma Therapeutics, Aro Biotherapeutics, Spirovant, AskBio (Bayer), and Interius all significantly expanding operations. • Spark Therapeutics/Roche announced plans to build a $575 million gene therapy R&D and manufacturing facility in University City, and WuXi AppTec announced plans to build a 1.7 msf testing and manufacturing facility in Delaware. • Local mRNA talent as well as the emergence of mRNA and cell and gene therapy cross-collaborations may fuel the next industry growth sector.

Public & Private Funding (2021)

Rent vs. Vacancy Comparison

Fast Lab Stats 17.8 MSF Market Square Footage $41.07 $ Per SF 5.0% Vacancy 38.6K Total Life Sciences Employment & Talent Pool 116% Life Sciences Employment Growth Rate Since 2001

Company

Deal Type

Completed Type

$ Raised (MM)

$50

12%

Century Therapeutics

IPO

Jun 2021

Public

$211.0

10%

$40

Nikang Therapeutics

Later Stage VC May 2021

VC

$200.0

8%

Century Therapeutics

Later Stage VC Feb 2021

VC

$160.0

Vacancy Rate

$30

Aro Biotherapeutics

Early Stage VC Dec 2021

VC

$90.3

6%

Sepax Technologies

Later Stage VC Nov 2021

VC

$78.1

$20

4%

Interius BioTherapeutics

Later Stage VC May 2021

VC

$76.0

$10

2%

MOBILion Systems

Later Stage VC Jul 2021

VC

$60.0

Average Asking Rent $/sf

Carisma Therapeutics

Early Stage VC Mar 2021

VC

$59.0

0%

$0

2015 2016 2017 2018 2019 2020 2021

iECURE

Early Stage VC Sep 2021

VC

$50.0

Mineralys

Early Stage VC Apr 2021

VC

$40.0

Asking Rents

Vacancy Rate

Representative Investment Sale Transactions (2021)

Address

Type

$ MM

RBA SF Date

Buyer

3701 Market St

Lab

$79.5

140,913 Jun 2021

GI Partners

Oaklands Corporate Center

Portfolio

$43.0

260,691 Nov 2021

Griffith Properties

Life Sciences Talent Pool

Representative Life Sciences Companies

400 Devon Park Dr

Lab Conversion

$19.5

138,065 May 2021

Mainstreet Capital

Talent pool includes life science professionals not currently employed in the life science sector

795 Horsham Rd

Lab Conversion

$14.5

110,000 Jan 2022

Eurofins

Company

Type

550 Blair Mill Rd

Lab Conversion

$12.1

97,123 Sep 2021

Spaulding & Slye

AstraZeneca

North America HQ

28,000

1850 N Gravers Rd

Lab Conversion

$7.7

72,000 Sep 2021

Spaulding & Slye

Century Therapeutics HQ, Research Facility

Amicus Therapeutics HQ, Research Facility

24,000

Representative Lease Transactions (2021)

GlaxoSmithKline

Research Facility

20,119

20,000

Company

Address

Size (SF)

New/Renewal

Type

Quarter

Landlord

J&J/Janssen

Regional HQ, Research Facility

Penn Gene Therapy

411 Swedeland Rd

150,000

New Lease

Office/Lab Q2

MLP Ventures

Teva Pharmaceuticals U.S. HQ

IQVIA

650 E Swedesford Rd

54,427

New Lease

Office/Lab Q4

Prologis

16,000

Endo

Research Facility

B.Labs

2929 Arch St

50,000

New Lease

Office/Lab Q2

Brandywine Realty Trust

Average Annual Growth Rate 2001-2021: 0.2%

Number of Persons

Merck

HQ, Research Facility

Idorsia Pharmaceuticals

100 Matsonford Rd

44,045

Renewal

Office/Lab Q4

Brandywine Realty Trust

12,000

Incyte

Research Facility

Biomeme

401 North Broad St

44,000

New Lease

Office/Lab Q2

Netrality Properties

Roche/Spark Therapeutics

HQ, Research Facility, Manufacturing

Avid Radiopharmaceuticals

3711 Market St

38,347

Renewal

Office/Lab Q4

Ventas

8,000

Roquette

727 Norristown Rd – Building 9

24,000

New Lease

Office/Lab Q3

Beacon

2011

Imvax

601 Walnut St

21,000

New Lease/Expansion cGMP

Q4

Keystone Property Group

2017

2021

2012

2015

2013

2018

2019

2016

2014

2010

2001

2007

2020

2002

2005

2003

2008

2009

2006

2004

Top NIH-Funded Institutions (2017-2021) $2.8B University of Pennsylvania $747M Children’s Hospital of Philadelphia $406M Temple University of The Commonwealth

Organon

727 Norristown Rd – Building 4

16,773

New Lease

Office/Lab Q1

Beacon

Intergral Molecular

One uCity Square

16,000

New Lease

Office/Lab Q4

Ventas

Bio Degree-Awarding Institutions, Metro Area • Drexel University • Temple University • University of Delaware

Research Contributor Michael Hanes michael.hanes@cushwake.com

• University of Pennsylvania • University of the Sciences

Sources: Cushman & Wakefield Research, CoStar, National Institutes of Health (NIH), Emsi, Pitchbook

16 / CUSHMAN & WAKEFIELD

LIFE SCIENCES 2022 MARCH UPDATE

Raleigh / Durham

Market Summary • One of the world’s largest life sciences clusters, North Carolina is home to 735 life sciences companies, 569 of which are located in the Research Triangle region in Raleigh/Durham. • Attracted to an extensive talent pool and stable business environment, several life sciences firms have recently announced plans to expand or develop new facilities. In total, the announcements reflect a $4 billion investment and the creation of 4,000 jobs. BioAgilytix Labs is one of many national companies that expanded their headquarters in 2021, with plans to create 878 jobs and invest $61.5M in Durham. • Demand for life sciences space remains strong, leading to numerous proposed projects (new construction and conversions) totaling approximately 8.2 msf. Nearly all new single-story construction is targeting cGMP/manufacturing occupants while the new R&D buildings will be multi-story facilities. • Rental rates are anticipated to go up as the quality of life sciences space improves. Additional factors such as dwindling land availability, along with increased land basis and increasing construction costs will also accelerate the increase in cost of life sciences space in Raleigh/Durham.

Public & Private Funding (2021)

Rent vs. Vacancy Comparison

Fast Lab Stats 12.3 MSF Market Square Footage $31.06 $ Per SF 12.3% Vacancy 19.4K Total Life Sciences Employment & Talent Pool 154% Life Sciences Employment Growth Rate Since 2001

Company

Deal Type

Completed Type

$ Raised (MM)

$35

25%

Bioventus

IPO

Feb 2021

Public

$120.0

$30

20%

StrideBio

Later Stage VC Mar 2021

VC

$81.5

$25

Xilis

Early Stage VC Jul 2021

VC

$70.0

Vacancy Rate

15%

$20

Istari Oncology

Later Stage VC Apr 2021

VC

$43.5

$15

10%

Inceptor Bio

Seed Round

Jun 2021

VC

$26.0

$10

Vestaron

Later Stage VC Feb 2021

VC

$21.0

5%

Myocardial Solutions

Later Stage VC Jun 2021

VC

$13.7

$5

Average Asking Rent $/sf

restor3d

Early Stage VC May 2021

VC

$13.3

$0

0%

2015 2016 2017 2018 2019 2020 2021

Cell Microsystems

Later Stage VC Nov 2021

VC

$12.7

Addyi

Later Stage VC Sep 2021

VC

$12.4

Asking Rents

Vacancy Rate

Representative Investment Sale Transactions (2021)

Address

Type

$ MM RBA SF Date

Buyer

The Stitch, 1001 Airport Blvd

Single tenant office/lab (former retail conversion)

$181.8

245,159 Dec 2021

Related Fund Management

Research Commons, 4101, 4301, 4501, 4201, & 4401 Research Commons

Partially leased office + land for conversion to life science campus

$138.0

429,758 Dec 2021

Oxford Properties Group

Representative Life Sciences Companies

Life Sciences Talent Pool

List represents top for-profit employers in the Research Triangle region based on employment.

The Genesis, 3029 E Cornwallis Rd

Partially developed site for conversion to life science campus

$91.0 100 acres Aug 2021

Alexandria Real Estate Equities

Talent pool includes life science professionals not currently employed in the life science sector

INQ 1101, 1101 Shiloh Glen Dr

Fully leased office/lab (former retail conversion)

$88.0

140,301 Dec 2021

TPG Capital

Company

Type

78 TW Alexander Dr

Lab

$50.5

236,976 Jun 2021

Eaton Vance RE

28,000

IQVIA

HQ, Contract Research

The Press, 2001 Evans Rd

Vacant office/warehouse for conversion to lab/cGMP

$38.0

276,812 Dec 2021

TPG Capital

Manufacturing and Administration

Perimeter's Edge, 1100 Perimeter Park Dr

Partially leased flex to lab conversion

$21.3

84,164 Sep 2021

Nuveen

Grifols

24,000

INQ 4300, 4300 Fayetteville Rd

Vacant retail for conversion to life science

$14.3

169,060 Dec 2021

DRA Advisors

Manufacturing, R&D, and Administration

Biogen

MidTown Biocenter, 350 E Six Forks Rd

Vacant retail for conversion to life science

$13.0

81,693 Nov 2021

East West Partners

20,000

BASF Agricultural Solutions

Research and Development

Average Annual Growth Rate 2001-2021: 0.5%

Representative Lease Transactions (2021)

16,000

Novo Nordisk Pharmaceutical Industries Manufacturing Syneos Health HQ, Contract Research Parexel International Corp HQ, Contract Research

Company

Address

Size (SF)

New/Renewal

Type

Quarter Landlord

12,000 Number of Persons

10,273

Invitae

The Stitch 1001 Airport Blvd Morrisville

250,000 New Lease Lab

Q2

Related Fund Management

Bradford & Berrington Centers 5827 & 5927 S Miami Blvd

Manufacturing and Administration

BioAgilytix Labs

173,928 New Lease/ Expansion

Lab

Q2 & Q4 Alidade Capital

8,000

bioMerieux Inc

Adverum Biotechnologies Inc (Subleased to Jaguar Gene Therapy) Parmer 14, 14 TW Alexander Dr

Office/Lab & Manufacturing Q1 & Q3 Alexandria Real Estate Equities

ICON

Contract Research

173,820 New Lease & Sublease

2011

2017

2021

2012

2015

2013

2018

2019

2016

2014

2010

2001

2007

2020

2002

2005

2003

2008

2009

2006

2004

Merck & Co. Inc

Manufacturing

CreeLED

Park Point Grid East & West 4001 NC 54

89,167 New Lease Office

Q3

Trinity Capital Advisors

Gilead Life Science

Midtown Plaza 305 Church at North Hills St

84,000 New Lease Office

Q2

Lionstone Partners

Bio Degree-Awarding Institutions, Metro Area

Top NIH-Funded Institutions (2017-2021) $2.8B Duke University $2.4B University of North Carolina Chapel Hill $890M Research Triangle Institute

Zoetis LLC

1050 Swabia Ct

78,394 New Lease Lab

Q2

W & G Associates

• Campbell University • Central Carolina Community College • Duke University • Durham Technical Community College • Meredith College • North Carolina Central University

• North Carolina State University • Shaw University • St Augustine’s University • University of North Carolina Chapel Hill • Wake Technical Community College • William Peace University

Azzur Cleanrooms

INQ 1101, 1101 Shiloh Glenn Dr Morrisville

75,300 New Lease Lab

Q2

TPG Capital

Xilis

31 Parmer Way

68,149 New Lease Office/Lab

Q4

Alexandria Real Estate Equities

Greenlight Bioscience

9 Laboratory Dr

62,772 New Lease Lab/Greenhouse Q3

Alexandria Real Estate Equities

BioLabs

Brightleaf Square 905 W Main

32,000 New Lease Lab

Q2

Asana Partners

Research Contributor Kristine Smith kristine.smith@cushwake.com

Sources: Cushman & Wakefield Research, CoStar, National Institutes of Health (NIH), Emsi, Pitchbook

17 / CUSHMAN & WAKEFIELD

LIFE SCIENCES 2022 MARCH UPDATE

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