Massachusetts-based REIT Diversified Healthcare Trust expanded its Bay Area portfolio to four properties with the acquisition of an 89,000-square-foot building in Fremont for $82 million. The fully leased building is the headquarters of Alamar BioSciences, a pre-clinical stage disease detection company.
The sales price works out to $926 per square foot.
The sellers were San Francisco-based Graymark Capital and Jadian Capital. JLL’s Adam Lasoff represented the sellers and procured the buyer.
The building, called Fremont Labs, sits on a 4.7-acre site at 47071 Bayside Parkway and was renovated earlier this year. The two-story building features open floor plans, premium lab space with airlocks, backup power, double loading docks and 21-foot ceiling heights. The building is divided into 56 percent office, 30 percent lab and 14 percent manufacturing and warehouse space.
Demand for life science space is surging in the Bay Area, which ranks second only to Boston as the largest life science market in the U.S., according to a report by CBRE. Some factors that explain the boom is that life science employees usually are required to work on site, while other sectors can accommodate remote work. As well as an additional surge in college students choosing to enter a career in the life sciences, and with nearby universities such as Stanford and San Jose State, the momentum for this sector should remain positive.
With this acquisition, DHC now owns four life science properties with a total 327,000 square feet in the Bay Area, as well as joint venture investments in two other properties in the market.
Jennifer Francis, president and CEO at DHC, said in a statement that in a macroeconomy with higher interest rates and a “corresponding negative effect” on real estate values, the company was “in the financial position to opportunistically acquire” Fremont Labs at an attractive price.
This deal comes on the heels of Scribe Therapeutics leasing a former Shipway building at the Research Park at Marina Village in Alameda. Also in the life science sector, Helios Real Estate Partners plans to redevelop a vacant warehouse in Menlo Park into life science laboratories.
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