Boston Properties, Alexandria, Begin Construction of 300,010 SQFT Development at 651 Gateway in South San Francisco

Boston Properties, Alexandria, 651 Gateway, South San Francisco, Gateway Commons, BioMed Realty, Gateway of Pacific
Gateway Commons. Courtesy of Alexandria

By Meghan Hall

Two years after announcing its plans for a South San Francisco project site, developers Boston Properties and Alexandria Real Estate Equities are finally breaking ground. According to a first quarter earnings report released by Alexandria, the joint venture has begun construction on 651 Gateway, a 300,010 rentable square foot life sciences project. Once complete, the building will be part of a 1.7 million square foot AAA life science and innovation cluster, according to the companies.

Plans from the City of South San Francisco show that the existing 17-story building on the site will be reclad  and modernized in order to accommodate modern office and lab uses. The project team received entitlements for the site in September of 2021. Prior to construction, 651 Gateway, along with 601 Gateway, was already 74.5 percent leased.

In its entirety, the development has been dubbed “Gateway Commons” and is “in the heart of the Birthplace of Biotechnology,” according to Boston Properties’ website. The project site is just eight miles south of downtown South San Francisco, near Highway 101 and San Francisco International Airport. The project is also not far from BioMed Realty’s Gateway of Pacific, which once complete will bring 2.2 million square feet of life science space to the market.

During the first quarter of 2022, Alexandria reported $615.1 million in revenue, up from $479.8 million during the first quarter of 2021. In addition to 651 Gateway, Alexandria has a number other projects in the works. The company kicked off a 345,995 rentable square foot project at 15 Necco Street in the Seaport Innovation District submarket of Boston, and it also started construction on 192,0000 rentable square feet at 9810 Darnestown Road in Rockville, M.D. The project is fully leased.

Over the next six quarters, the company believes that its projects will generate $665 million worth of incremental annual rental revenue, primarily from the second quarter of 2022 through the first quarter of 2025. Eight million of its value-creation projects are under construction or will start construction in the next year and a half, 77 percent of which are leased or in negotiations.

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