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Long Island City Is The Land Of Opportunity For NYC's Upstart Life Sciences Industry

Long Island City might still be known in national commercial real estate circles as the Queens neighborhood where Amazon had planned to put an 8M SF headquarters, but abruptly backed off in 2019 amid political opposition. But out of Amazon's shadow, a different industry has been quietly gobbling up space in the area across the East River from Midtown Manhattan.

The neighborhood's winning combination of accessibility, zoning, lower costs and young talent that drew Amazon have attracted some of the biggest players in the life sciences sector, who point to Long Island City as the future epicenter of the industry in New York.

The view of Long Island City from Manhattan

King Street Properties, one of the nation's largest owners of life sciences real estate, started looking at Long Island City to fill a gap in NYC’s market more than five years ago. Its appeal centers on its manufacturing buildings and zoning left over from the neighborhood’s industrial past, strong public transit links to Manhattan, Brooklyn, Westchester and Long Island, proximity to financial and academic institutions and lower lab rents than Manhattan and Boston.

“We think Queens has all the ingredients,” King Street Chief Investment Officer Rob Albro said. “We think Long Island City is going to be one of the major nodes, if not the major node.” 

Newmark is tracking 1.25M SF of life sciences projects, both delivered and proposed, in Long Island City alone — enough to nearly double the city's total inventory. 

Alexandria Real Estate Equities, the largest life sciences developer in the country, entered the neighborhood in 2018 when it bought the 175K SF Bindery Building and converted it to lab space. King Street's joint venture with GFP Real Estate is spending $240M redeveloping 45-18 Court Square West into a life sciences building, which has signed deals with Innolabs and, more recently, a 48K SF lease with Opentron Labs.

Life sciences developer Botanic Properties bought a school at 24-02 Queens Plaza South in 2020 with plans to eventually build a 270K SF lab building on the property, while Boston-based Longfellow Real Estate Partners, which is developing the New York Blood Center in Manhattan, bought a 208K SF building in the neighborhood in December for nearly $100M, with plans to spend more than $100M on a life sciences conversion.

Those projects are adding to the city's rapidly burgeoning life sciences sector, which is growing in standing as the industry swells with cash — more than $43B in venture capital funding went to biotech firms last year — and expands beyond the three dominant markets of Boston, San Francisco and San Diego. 

“New York is the financial capital of the world,”  JLL Senior Vice President John Cahill said. “As companies mature, they look to have mergers and acquisitions, or to going public on the markets. Investors want to be here, and they want companies to be here now.”

Boston and Cambridge have a combined 45M SF of life sciences real estate, compared to 1.9M SF of lab properties in New York City at the end of 2021, according to CBRE research. That number is expected to hit over 4M SF by 2025, bolstered by growing demand and record leasing activity — as well as hefty government incentives.

Ali Esmaeilzadeh, Brookfield's senior vice president for development in greater New York, credited the city and state government's programs for kick-starting momentum, just like former Mayor Michael Bloomberg's efforts to woo the tech industry are still bearing fruit today.

“We take the volume of tech in this city for granted, but that wasn’t always the case,” Esmaeilzadeh said at a Bisnow event last month. “Ten years from now, I think we’ll be talking about life sciences in New York like they talk about in Cambridge.”

Both New York City and state governments have dangled substantial incentives under the noses of players in the life sciences space. Companies can claim refundable state tax credits of 15% to 20%, depending on how many employees they have, in addition to tax credits available to biotech companies from the city government. Life sciences firms can also claim deductions on property taxes and mortgages, available via New York City’s Economic Development Corp.

But these incentives are just the beginning for NYC’s life sciences industry according to Cahill, who has worked in life sciences development in New Jersey and New York for the last 17 years.

“New York has lagged,” Cahill said. “New York is 10 years into a 30-year game. We’re the emerging growth market, not the mature market. But there are a lot of positive trends and indicators that make New York City an exciting opportunity.”

As the sector grows, developers are looking beyond Manhattan and zooming in on Long Island City, which has millions of square feet of current and former industrial buildings with manufacturing zoning, which are far easier to convert to lab and biomanufacturing space than office towers.

“Long Island City has just an unbelievable industrial heritage,” Newmark Director Bill Harvey said. “That manufacturing zoning is the designation that works best for life sciences.”

Skyscrapers and office tower blocks that can easily accommodate a range of residential and commercial struggle to fill a wet lab’s needs for loading spaces, high ceilings and specialized plumbing capacities for waste disposal. 

“Think about the types of buildings that tend to be found in manufacturing districts,” Harvey said. “It's not the towers that you see in Manhattan, but it's that kind of short, squat building that lends itself so well to conversion.”

Long Island City also has an advantage over Manhattan when it comes to real estate costs. Lab space in Manhattan has an average asking rent of approximately $114 per SF, according to CBRE, compared to Long Island City's average of $85 per SF. Newmark research shows lab rents in Manhattan can reach $145 per SF.


Long Island City’s proximity to Manhattan also places life sciences companies close to the city's academic institutions — it's one subway stop from Cornell Tech, a Cornell University campus in the heart of NYC’s East River-based life sciences corridor specializing in technology, business, law and design.

“The institutions that we have here are unbelievable. We have more postdocs in New York City than in Boston or San Francisco,” Harvey said. “In terms of academic firepower, the hospitals and the universities in this city are second to none. And I think it's inevitable that they're gonna play a big part in the development of this evolving life science cluster.”

That academic talent has always been here, JLL’s Cahill said, but the growth of the private life sciences industry in NYC has enabled it to take root.

“Ultimately, New York is blooming because of its talent and labor force — that's healthcare and life sciences,” he said. “The talent that’s always been in New York is no longer leaving New York to go to Boston.”

Long Island City has for years attracted residential tenants — its waterfront views, convenient transit connections have lured developers to the area in recent years, turning it into one of the fastest-growing neighborhoods in the country by 2019.

“There's certainly a cost advantage to being in Long Island City versus Manhattan, but I think most fundamentally, it has to be attractive to a young, well-educated, sophisticated workforce,” Harvey said. “Long Island City is a great place to be, it’s got a work-live-play dynamic.”

Long Island City’s journey from industrial hub to residential hot spot to Amazon castoff to life sciences cluster is far from complete, but it’s taking shape fast, Long Island City Partnership President Elizabeth Lusskin said.

“We’re making huge progress. It’s usually a 20-year period to get these clusters up and running, and in a very short period of time, Long Island City is up and running,” Lusskin said. “Long Island City, much more so than a couple of years ago, is ready for its close-up.”

CORRECTION, MARCH 24, 11:30 A.M. ET: Botanic Properties acquired a Long Island City property at 24-02 Queens Plaza South, not 43-10 23rd St., as a previously version of this story indicated. That property, a 208K SF building, was acquired by Longfellow Real Estate Partners. This article has been updated.