A loan tied to a research and development campus in Emeryville is on the market.
Morgan Stanley is selling a $106 million note backed by the Ratio Innovation Campus, potentially giving a buyer an avenue to acquire the two-building property outright via a deed-in-lieu of foreclosure, the San Francisco Business Times reported.
Beacon Capital Partners has owned the 240,916-square-foot campus at 6401 Hollis Street and 1480 64th Street since 2021 when it acquired the site from BentallGreenOak for $130 million. Beacon took out a more than $106.4 million floating-rate loan from Morgan Stanley that same year with plans to revamp the facility for life sciences tenants. The loan comes due in March.
Beacon renamed the property from Hollis Business Center to Ratio Innovation Campus in 2022 as part of that repositioning effort. The Boston-based firm invested more than $39 million for building and mechanical upgrades and improvements to amenities and common areas.
When Beacon purchased the property, funding for the life sciences and biotech sectors was at an all-time high, and confidence in the market’s future was strong. But after President Donald Trump took office last year, federal funding for life sciences and related sectors began to disappear, causing demand for life sciences real estate to evaporate. In the fourth quarter, the R&D market in Emeryville saw a 43 percent vacancy rate, per CBRE data cited by the Business Times, higher than the 28.5 percent overall life sciences vacancy rate in the East Bay corridor.
The Ratio Innovation Campus is currently 71 percent leased to six tenants, about half of which are life sciences companies including Totus Medicines and Arcadia Science, as well as the Rocky Mountain Cancer Center medical facility. Whole Foods Market has an office there, as does LifeStance Health.
Whether the Ratio Innovation Campus itself hits the market — and for what price — remains to be seen. Last month, Blackstone listed the 234,016-square-foot EmeryTech campus at 1400 65th Street in Emeryville. That property is expected to trade hands in a short sale, meaning it would sell for less than the debt tied to the site. — Chris Malone Méndez
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