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Oxford to invest $985M in 4 U.S. life sciences assets

Oxford Properties Group has acquired four life sciences properties plus developable land in the B...

IMAGE: A rendering of Oxford's proposed addition to its new Public Market Emeryville life sciences property in the Bay Area of San Francisco. (Courtesy Oxford Properties)

A rendering of Oxford’s proposed addition to its new Public Market Emeryville life sciences property in the Bay Area of San Francisco. (Courtesy Oxford Properties)

Oxford Properties Group has acquired four life sciences properties plus developable land in the Boston and San Francisco areas for $350 million (all figures Cdn). It also plans to develop an additional $635 million worth of medical laboratory space at the Bay Area property.

The acquisitions and development plans are part of Oxford’s strategy to become a larger player in the life sciences sector, which it sees benefitting from emerging trends in the convergence of technology and science.

Oxford has been building up both assets and a bank of development land in the sector since 2017. It has also been engaged in the life sciences sector through its credit business.

The San Francisco-area asset is the Public Market Emeryville, acquired in partnership with City Center Realty Partners, a San Francisco-based real estate developer and investor.

The 148,000-square-foot mixed-use property comprises lab space, retail, food and offices within the established life sciences cluster of Emeryville.

The investment includes 36,000 square feet of ground-floor, first-generation lab space, a food hall and approximately 60,000 square feet of office and retail space which Oxford intends to convert to lab space.

The deal also features land parcels Oxford plans to develop into purpose-built lab product in a market with almost zero availability for such space.

Life sciences a priority for Oxford Property Group

“Growing a meaningfully sized life sciences business represents one of our highest-conviction investment strategies and top priorities across our business,” said Chad Remis, executive vice-president, North America at Oxford Properties, in the announcement.

“These transactions grow our presence in two key global life sciences markets and complement our existing portfolio of assets and significant development pipeline in the sector.

“It gives us a solid foundation to continue to grow from as we seek to scale this part of Oxford’s business in 2021.”

City Centre had also been part of the previous ownership joint venture.

“City Center looks forward to our collaboration with Oxford on this project and continuing our successful transformation of Public Market Emeryville from a suburban-style collection of buildings and surface parking lots into a premium mixed-use life science campus in the East Bay,” said Mark Stefan, City Centre’s president and co-founder, in the release.

Three Boston-area properties

Oxford also acquired three assets in the Boston area:

– 33 New York Ave. is a core, recently completed 114,000-square-foot state-of-the-art bio-manufacturing facility 100 per cent leased to Replimune Group Inc. and CRISPR Therapeutics.

– 1 and 5 Mountain Rd. are two adjacent buildings that comprise 153,000 square feet and are currently leased to Sanofi. Oxford has identified significant value-add opportunities for 1 and 5 Mountain Rd.

Oxford’s push into life sciences in North America will initially focus on Boston, the San Francisco Bay Area, San Diego, and other emerging locations, the company said. Beyond North America, Oxford is also reviewing opportunities across Europe as it seeks increased global exposure to the asset class.

“Growth in this asset class is being driven by a number of tailwinds. Aging populations are a demographic engine; however, the need for new treatments, diagnostics and equipment goes beyond that trend alone,” Remis explained in the announcement.

“Technology and science are converging with advances in data analytics and AI that is accelerating life-changing innovations across biotech, pharmaceuticals, nutrition and medical devices.

“As a result of this shift, private equity and venture capital funding for promising products and companies has markedly increased in recent years. This surge of activity and the formation of new and growing companies is taking place against the backdrop of a limited supply of lab infrastructure in the sector’s key global markets.”

About Oxford, City Centre Realty Partners

Established in 1960, Oxford Properties Group manages approximately $60 billion of assets across the globe on behalf of its co-owners and investment partners.

Oxford’s portfolio encompasses office, retail, industrial, hotels and multifamily residential and spans more than 100 million square feet across four continents. It invests in properties, portfolios, development sites, debt, securities and platform opportunities across the risk-reward spectrum.

While its global headquarters is in Toronto, Oxford operates out of over 15 regional offices including New York, London, Luxembourg, Singapore and Sydney. Oxford is owned by OMERS, the defined benefit pension plan for Ontario’s municipal employees.

City Center Realty Partners, LLC (CCRP) is a San Francisco-based real estate investment firm specializing in the development, redevelopment and acquisition of urban real estate. Across the United States, CCRP has developed and acquired more than $1 billion of retail, office and mixed-use properties.

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