BioMed Investment Helps Solve Colorado's Life Sciences Conundrum
A major investment by Blackstone-backed BioMed Realty Trust in Boulder real estate has the potential to change and accelerate the pace of the proliferation of the life sciences industry in Colorado by adding to the Front Range’s scant supply of existing laboratory space.
Life sciences companies like the Front Range make up the largest share of prospects in Metro Denver Economic Development Corp.’s pipeline. But when they come to visit, these companies are faced with a shortage of laboratory space that can complicate their plans.
But BioMed’s acquisition of the 22-building, 1M SF Flatiron Park near the University of Colorado’s BioFrontiers Institute, announced earlier this week, is a big step toward changing that, according to Chris Wiley, principal at Colliers International’s Denver office, who specializes partly in the life sciences industry.
“BioMed will certainly come in with a knowledge of how to construct laboratory space, and will come in with the capital to build it,” he told Bisnow.
A release from BioMed indicates that the company is prepared to invest an additional $200M redeveloping its new Boulder real estate.
Roughly 4.7M SF of laboratories exist in the market, according to 2021 data compiled by Cushman & Wakefield. And it is expensive to build, at about $300 per SF, according to Wiley. It takes a company with deep pockets to make the investment in a meaningful amount of lab space, and Blackstone fits the bill.
“They’re planning to come in and put a bunch of money into the buildings they have to convert them to spec lab, and spend the capital to change the infrastructure to allow for a base building to support the needs of life sciences,” he said.
“It brings another level of sophistication to our market,” Wiley said.
It’s unlikely that BioMed is finished making purchases in the area. Jon Bergschneider, the company’s president of West Coast markets, told BizWest that the Flatiron Parks acquisition was “by no means the end of our investment tolerance” in the market.