A $265M loan will fund continued adaptive reuse of a historic former publishing complex in Philadelphia’s Center City, a bid to build a bigger biotech ecosystem to meet the region’s growing demand for lab space at a time when financing is becoming more challenging.

The loan from Nuveen will allow owner Keystone Development + Investment to continue its renovation of The Curtis, a 13-story brick building the firm purchased for $125M in 2014 with an aim to create a new mixed-use complex including space for biotech tenants. The firm refinanced the space in 2017.

Keystone has already converted a former printing press space into wet labs occupied by firms such as IMVAC, Vivodyne and Aro Biotherapeutics.

This new loan will fund the transformation of other parts of the complex into lab space, including building out new incubator space, as well as graduate space to be run by BioLabs, serving as an intermediate step between incubators and independent labs. The capital will be enough to convert an additional 200K SF over the next several years.

Keystone Regional Director Jaime Rash told Philadelphia Business Journal that the conversion will cost roughly $100 per SF to build versus $300 to $400 per SF for new construction.

A Q1 2022 life sciences report from Cushman & Wakefield, which named Philadelphia as a top market, found the city’s biotech sector had a 5% vacancy rate and significant expected growth in the mRNA and cell and gene therapy fields.