A Mission Bay office building that once served as the headquarters for Old Navy may soon be filled with life science labs.
DivcoWest, based in San Francisco, is negotiating a lease with SmartLabs, a lab space provider that seeks 80,000 square feet at 550 Terry Francois Boulevard, the San Francisco Business Times reported, citing unidentified sources close to the deal.
SmartLabs, based in Boston, rents R&D laboratory space to life science companies. Its business model has been compared to flexible office co-working firm WeWork.
Last March, DivcoWest bought the 314,800-square-foot building from Gap, Old Navy’s parent company, for $356 million.
The investment firm, which paid $165 million in January for a vacant waterfront office and research building on Shoreline Court in South San Francisco to turn into labs, had similar plans for its purchase in San Francisco.
It aimed to convert the six-story building into space for life science and biotech companies in Mission Bay, where the lab vacancy rate stood at just 0.1 percent in 2021.
Divco West didn’t respond to a request by the Business Times for comment. SmartLabs didn’t confirm or deny the negotiations, but said in an email it had “more than doubled its footprint nationwide” since spring of 2021 and was expanding.
A San Francisco lease would bring SmartLabs into its fourth city in the U.S.
SmartLabs, founded in 2014, has two rental lab locations totaling 250,000 square feet in South San Francisco and just opened a 500,000-square-foot rental lab office in Philadelphia.
SmartLabs’ expansion was fueled by a $250 million Series B funding round led by ArrowMark Partners in September 2021. At the time, the company said that it would use the new capital to execute its plan to scale operations to 2 million square feet within five years.
— Dana Bartholomew
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