Pasadena-based Alexandria Real Estate Equities made a rare sale earlier this month. In an announcement included in the company’s first-quarter of 2021 results, Alexandria stated that in April of 2021 it had sold a 70 percent interest in 213 East Grand Avenue in South San Francisco for $301 million, or $1,429 per square foot, according to the company’s statement. The sale, which closed on April 22nd, closed at a 4.5 percent cap rate and a total valuation of $430 million.
The buyer was not disclosed, and the ownership of the remaining 30 percent of the property was also not shared in the company’s announcement.
The 300,930 square feet of lab space has been leased to Merck. The two companies announced in late 2016 that Alexandria would be developing the property for the global life science corporation.
“We are honored to expand our strategic relationship with Merck, one of our current tenants, as the company establishes its San Francisco Bay Area R&D hub,” said Joel S. Marcus, chairman, chief executive and founder of Alexandria Real Estate Equities, Inc. in a statement at that time. “This move is significant for Merck and South San Francisco, bringing another leading pharmaceutical player to the vibrant biotech and pharma community and reinforcing the Bay Area as a leading cluster for discovery and collaboration.”
213 East Grand Avenue offers Merck a long-term real estate solution in close proximity to academic research and startups, according to a statement from Alexandria. The facility also offers Merck’s employees convenient access to neighborhood businesses in downtown South San Francisco, as well as to the city’s new mixed-use, transit-oriented neighborhood between 213 East Grand Avenue and a new Caltrain station. The amenity-rich campus features inviting and open green space to promote health and wellness as well as function as an outdoor event space. The site also includes a 300-seat auditorium, a fully equipped fitness center and a lively café and terrace with waterfront views designed to enhance innovation, productivity and collaboration.
“We are excited to partner with Alexandria on this new state-of-the-art research center located in the heart of the Bay Area’s life science community,” said Dr. Roger M. Perlmutter, president of Merck Research Laboratories in a statement.
“We are pleased Merck chose the 213 East Grand Avenue site for its new location in our San Francisco cluster,” said Steve Richardson, chief operating officer and regional market director of San Francisco at Alexandria Real Estate Equities, Inc. in a statement. “As the country’s leading urban developer of science and technology campuses, Alexandria brings its expertise in designing, developing and operating inspiring and mission-critical facilities to this project – a research facility that will support Merck in its mission to save and improve lives around the world.”