The Kips Bay section of Manhattan is getting a $1.6B life sciences hub, New York Gov. Kathy Hochul and New York City Mayor Eric Adams announced Thursday.

The price tag makes the East River-hugging hub the biggest economic development project of Adams’ first year in office. The site for the hub will span almost 5 acres, according to Politico, which first reported the news.

The hub, named the Science Park and Research Campus Kips Bay, or SPARC for short, will sit on a stretch of First Avenue between East 25th and 26th streets and be anchored by a new CUNY nursing school. It is planned to include a forensic pathology center and an ambulatory care center for the city’s public hospital network, NYC Health + Hospitals. The Kips Bay hub will also provide space for the NYC Department of Education to connect students in higher education programs to STEM careers.

The 1.5M SF project — expected to break ground within the next two years — could create 10,000 construction jobs during the period and 2,000 permanent jobs, creating up to $25B in economic benefits over 30 years, the state announced.

A developer was not named for the project, but the New York City Economic Development Corp. and CUNY were named as partners and will receive support from architecture firm Skidmore, Owings & Merrill, according to Commercial Observer.

Hochul and Adams’ chosen location will help flesh out the growing East River life sciences cluster, which includes the Alexandria Center for Life Sciences, NYU Langone Health, Bellevue Hospital, the Memorial Sloan Kettering Cancer Center, Partnership Fund for New York City President and CEO Maria Gotsch told Bisnow.

“You're going to have good critical mass in a neighborhood that is near the academic medical centers,” Gotsch said, adding that workforce training plans and the hub’s partnership with CUNY adds to the plan's long-term potential.

The cash injection from the city and state may also persuade venture capital investors who have been pulling back from the sector in recent months, Gotsch said. Earlier this year, public markets began to shrink away from the life sciences industry, creating a ripple effect on valuations. It also pushed some investors to focus on supporting existing portfolios rather than looking at new opportunities.

But this public investment will likely reassure investors and markets about the industry’s long-term potential in spite of current macroeconomic trends, Gotsch said. “I think it'll be a good signal,” she told Bisnow.

The hub — which reportedly came together after negotiations between City Hall Chief of Staff Frank Carone and Secretary to the Governor Karen Persichilli Keogh — places the life sciences industry at the forefront of NYC’s economic recovery.