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King Street's New Research Triangle Exec Talks Challenging Boston's Biotech Dominance

Like so many life sciences markets across the nation, Research Triangle Park in North Carolina has struggled with surplus space, increasing vacancy and a sense that recent boom years have entered a slowdown.

But Sara McTyeire, the recently hired executive director for the Triangle for Boston-based King Street Properties, remains bullish based on her industry experience and the observation that talent and investment will continue to flow south from the Boston area.

The Research Triangle is poised for additional real estate growth, King Street’s Sara McTyeire says.

She isn't alone: Boston’s hometown newspaper identified the massive biomanufacturing plant King Street has under development in RTP, Pathway Triangle, as part of a growing “threat” that more such facilities would be built outside of Massachusetts.

“It’s not as doom and gloom down here as some of the other markets that I think, frankly, are historically used to exponential growth and a sub-5% vacancy rate,” she told Bisnow. “We're seeing activity.”

A longtime Research Triangle resident, McTyeire held a position at GSK as director of real estate and asset management, overseeing the Big Pharma firm’s 7M SF portfolio. Before that, McTyeire worked for JLL in the Raleigh-Durham region.

She joins King Street as the firm has 1M SF in development in the region, a big addition to its existing 650K SF portfolio. Like King Street and other Boston-area developers that have started work in the Triangle lately, McTyeire sees a shift taking place despite market uncertainty. 

The following is lightly edited for style and clarity.

Bisnow: What are some of the big drivers and trends in the market that made you interested in pursuing life sciences development in this area again? 

McTyeire: I think that Raleigh is truly very well positioned for exponential growth. And a lot of that's just due to the quality of living, the labor and the research institutions and technical colleges we have, especially in life sciences and biomanufacturing. For companies and industries that may not be able to break into either a tighter or more expensive market, I personally think this is an incredibly exciting place to be in the industry, which is one of the reasons that I came over to King Street. 

Bisnow: Where do you see room for expansion and new development in the Triangle?

McTyeire: We obviously really liked the Morrisville area. We currently have 650K SF of ownership over there. We're developing another million. We like that area quite a bit. But we're seeing it push out a lot. I mean, the likes of Holly Springs, there's plenty of opportunities around there we continue to look at. It's also not confined to the park any longer. I mean, people are really opportunistic. Outside of the Triangle, in these other suburban areas, they're growing like gangbusters.

Bisnow: How do you see the North Carolina marketplace performing? Are we going to start seeing a lot more biomanufacturing break ground? Are we going to see a lot more lab and R&D space? Because it feels the Triangle has always been a bit behind when it comes to pure lab space.

McTyeire: If you look at the life span of some of these fit-outs and projects, a year or two is nothing, and I don’t think we’re necessarily going to see a quick pivot towards more R&D space. In terms of biomanufacturing, I think we are seeing some developers slow, given the supply that's currently out of the ground and/or ready for tenant fit-out. Honestly, that’s kind of nationwide.

But, you know, a couple of deals start popping, and all of that comes back. There’s plenty of ideas and thoughts in the pipeline. So I don’t think the Triangle is near any kind of peak. It’s just kind of a strange point in time. 

Bisnow: How would you sort of characterize biomanufacturing demand, especially coming from Big Pharma? There’s a ton of hype and talk about GLP-1 and just the incredible demand forecast for these drugs. What does that do both for biomanufacturing capacity and development, in general, but also specifically for the Triangle? 

McTyeire: I think the hype is real. Onshoring, obviously, has been a bit of the focal point for pandemic, having access to these critical assets stateside. The value of these investments from both the development side on spec and owner-occupier are eye-watering figures. Across the industry, we’re seeing this, and the Triangle is just honestly a perfect little hotbed for that opportunity to land.

Bisnow: There's all this talk of tons of M&A money in Big Pharma and the patent cliff. How do you see Big Pharma’s demands impacting the real estate market going forward?

McTyeire: I think M&A is clearly going to be at the forefront. And so, obviously, that lends itself more towards organic real estate growth. But I think you’ll see a lot of consolidations and looking to get people under one rooftop. I feel like M&A is going to continue to drive dots on the map for these kinds of companies. They are really looking at real estate much more dynamically, how you actually attract and retain the best talent.