The Real Deal New York

Vornado, Related target life-sciences tenants for Farley Post Office redevelopment

Joint venture is looking to tap into high-growth sector
April 02, 2018 08:18AM

Steve Roth and Stephen Ross with the Farley Post Office Building

Vornado Realty Trust and the Related Companies are targeting biotechnology and pharmaceutical tenants for their redevelopment of the Farley Post Office Building.

The joint venture hired a broker from Boston, which has a more mature life-sciences industry, to develop a marketing strategy to attract such tenants to the 900,000-square-foot office-and-retail project, the Wall Street Journal reported.

“New York is eight years into a 25-year process to grow a [life-sciences] cluster,” said Joel Marcus, founder and chief executive of Alexandria Real Estate Equities Inc., which developed a life-sciences campus on the East Side of Manhattan. “You don’t have the large cadre of entrepreneurs who have started a business, exited and started again.”

Life-sciences is pegged as the newest high-growth industry for the city, following the expansion of tech companies. Much like the Bloomberg administration courted tech companies, under mayor Bill de Blasio the city’s Economic Development Corp. put a request for proposals offering $100 million in city land and other benefits for developers to build a life-sciences hub.

NYU Langone Medical Center is working with Cambridge, Mass.-based BioLabs to create a 50,000-square-foot biotech co-working center in Hudson Square, and Taconic Investment Partners and Silverstein Properties are looking to attract companies to lab space at 619 West 54th Street.

But while New York has long had first-rate medical and research institutions, limited lab space has made it difficult to retain life-science startups.

The high cost of building upgrades and zoning requirements have left the city with just 2.8 million square feet of rentable lab space, compared to 16.2 million square feet in New Jersey and 26.8 million square feet in the greater Boston area, according to JLL.

CBRE vice chairman Steve Purpura said there are 4.8 life-science employees living in Manhattan for every life-science job in the borough.

“We discovered that there is more life-sciences labor that lives in Manhattan than works in Manhattan,” he said. “People in New York who have life-sciences degrees are working in other industries or commuting out to New Jersey.” [WSJ] – Rich Bockmann