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Facilities and Campuses designed for Biotech
The Bay Area can be split into three biotech sub-markets: the Peninsula, East Bay, San Francisco and Silicon Valley. Each offers advantages to a tenant, depending on factors such as their company’s size, budget, workforce, and overall economic value. While many biotech companies reside in the Bay Area, there is a limited number of facilities or campuses that were specifically designed for the biotechnology or biopharmaceutical fields.

Peninsula
The Peninsula is traditionally the home of biotechnology and is a premium location in which to conduct business. Stretching from San Francisco to Palo Alto, this area is bounded by University California San Francisco in the north and Stanford University in the south. World-class research universities such as the California Institute for Regenerative Medicine and the Gladstone Institute also reside in the Peninsula commercial real estate market.

Facilities located in this area can range from older space that was traditionally used by light industrial businesses–but were converted to new lab-specific offices to meet the needs of biotech lab users. Mission Bay, a new San Francisco-based lab complex, is expected to contribute over 3 million square feet of space over the next few years. These facilities will come at a premium, demanding some of the highest rents in the Bay Area.

Silicon Valley
The Silicon Valley has built a reputation as the high-tech hub of the world. Wrapping around the south shores of the Bay, Silicon Valley encompasses the area from Palo Alto to San Jose to Fremont. NASA Ames and the San Jose BioCenter are among the research facilities located within the area.

The dot-com bust that followed the enormous Silicon Valley growth of the 1980’s and 1990’s led to a large vacancy rate in R&D buildings. Many of these facilities are older and lack the amenities found elsewhere; thus the need for biotech build-outs is prevalent. Campuses preferred by biotech companies include McCarthy Center and Stanford Research Park, located in Milpitas and Palo Alto, respectively.

East Bay
Sweeping from Hayward to Richmond and as far east as Pleasanton, the East Bay is the rising star in value for biotech companies. This sub-market is home to UC Berkeley, Lawrence Laboratories., Companies such as Bayer, Clorox, Chevron, and Kaiser have large campuses in this area. The draw of the East Bay for many companies includes commuter accessibility, affordable housing, lower lease rates than the Peninsula, a good assortment of building amenities, and overall economic value. A generous mix of old and new facilities can be found, making second and third generation lab-specific build-outs common and desirable as the lower cost alternative.

Emeryville and Berkeley are prime locations for many biotech companies due to their close proximity to the University and business-friendly atmosphere. As a result, these cities typically have very low vacancy rates and rents that tend to be higher than elsewhere in the East Bay.

Alameda, located across the estuary from Oakland, hosts two biotech hot spots including Marina Village and Harbor Bay. Richmond is home to the Berlex Campus and many R&D buildings. In recent times both Alameda and Richmond have become alternatives to the somewhat higher lease rates in Emeryville and Berkeley.

Inland cities such as Pleasanton, Dublin, and San Ramon offer a large assortment of new space and host many corporate campuses with rents that tend to be lower than the rest of the Bay Area. With the growing number of biotech businesses in the Bay Area, the East Bay is expected to become home to those looking for lower lease rates and for start-up companies.

Factors that make the Bay Area a unique setting for the Life Science Industry

The Bay Area is unique in that it offers a virtual melting pot of culture, beauty and charm found nowhere else in the world. There are four major research universities with three medical schools that call the Bay Area home: Stanford University, UCSF, UC Berkeley, and UC Davis. Supplying a well-educated workforce to life science and biomedical firms comes naturally in such an environment.

Northern California contains 34% of all venture capital investment firms. Combine this with the entrepreneurial spirit of Bay Area residents and it’s no wonder the region boasts the highest concentration of biotech firms in the world.

Expected Growth
As a whole, the biotech industry is very young–80% of the companies located in the region are less than 9 years old. Biotech has continued to grow and receive venture capital money despite the most recent economic downturn. It is projected that overall employment of science technicians will grow by 10-20% through 2012.

Taking into account the 90,000 jobs created by the 900 companies currently in the region, growth projections are staggering for such a short amount of time. It is estimated that 6,000 jobs have been created in the past 12 months due in part to this emerging industry. Growth can be attributed to an increase in science and medical research centralized around biotechnology and development/production of technological products.

Numerous entrepreneurs are entering the biotech market with aspirations to dominate industries such as bio-fuels, alternative energy, and medical. The Bay Area currently is home to about 20 million square feet of biology lab space. The vacancy rate for biotech space is below 10%, leaving very little room for future growth and new construction is scarcely keeping up with the current demand.

AEGIS Realty Partners knows that securing the right facility and location is critical to the success of every biotech business in the Bay Area.

Unlike most professional services firms, the facility needs of biotechnology and biopharmaceutical companies are specialized. The cost to build out Vivariums, GMP manufacturing, Research and Production areas, Fume hoods, Biology Labs, Wet Labs, Chemistry Labs, Cold Rooms, and Clean Rooms can run from $150-$500 per square foot or more. AEGIS knows this capital outlay can be a challenge for biotech and other life science companies. We focus our efforts on helping businesses to minimize these costs.

AEGIS has strong working relationships with Bay Area landlords who consistently invest in biotech-friendly building improvements. These relationships ensure that AEGIS’ clients receive the best opportunities to acquire office space that meets their business needs at an affordable cost. This allows our biotech clients to invest more of their capital in research and less in facility-related expenses.

AEGIS also diligently monitors the biotech community to determine if companies in sought-after campuses are vacating space and what type of improvements are being left behind. Our brokers are then able to match a company with the best pre-existing amenities to minimize our clients’ facilities costs.

Our brokers know that biotechnology companies have specialized office space needs that require industry knowledge and extensive commercial real estate experience. AEGIS’ brokers have successfully combined this knowledge and experience to provide the best possible service to our clients.

If you would like to speak with us about biotech office space in the Bay Area, please contact us at (510) 273-2000 or admin@aegisrealty.com.

Selected AEGIS Biotech clients and references

Biotechnology and life science firms are thriving in the San Francisco Bay Area. From San Jose to Emeryville, and Pleasanton to San Francisco, the growth of these industries over the past decade has been tremendous. On average, Northern California nurtures 30 or more newly-founded biotech companies per year. AEGIS biotech clients include; Aurora Biofuels, Amyris Biotechnologies and MedAmerica.

It is estimated that there are 900 biotech companies spread throughout the region including Genentech, Bayer, and Amgen. With strong venture capital funding, there seems to be no end in sight for the projected growth of the life science industry. With so many companies and not nearly enough laboratory facilities, it has become increasingly important for these growth-oriented companies to be represented by knowledgeable and capable brokers when searching for biotech, lab and office space that meets their specialized requirements.

Follow this link to learn why biotech firms choose AEGIS to help them find lab space throughout the entire Bay Area.

If you are looking for biotechnology lab space, call one of AEGIS’ brokers at (510) 273-2000 or email us at admin@aegisrealty.com for help with your search.

Click here to view our successful lease and sales experience with biotech clients.

Click here to search available lab space in the Bay Area market.