Healthpeak gains approval for life science expansion in South SF

Healthpeak Properties has gained approval to expand its biotech development by nearly 1.3 million square feet in South San Francisco.

The Denver-based real estate investment trust was approved to build four office and research laboratory buildings at Forbes Boulevard and Allerton Avenue, the San Francisco Business Times reported.

When complete, the 1.65-acre Vantage project would include up to six office-lab buildings, three parking garages and an amenities building on more than 19 acres.

Its first phase includes a five-story, 154,000-square-foot building leased to Japan-based Astellas Pharma, which began moving in last month at 480 Forbes Boulevard. There’s also a six-story, 188,000-square-foot building. A 40,000-square-foot building with a cafe, deli, gym and conference room is under construction.

Healthpeak was approved by the South San Francisco City Council to build the second and third phases, which include four buildings totalling 1.29 million square feet near the headquarters of Genentech. A timeline for construction was not disclosed.

The angular glass project, designed by San Diego-based Flad Architects, would include a 12-story, 440,000-square-foot office-lab tower at 415 Allerton Avenue.

The next phases would also include two 10-story buildings of 316,600 square feet and 283,000 square feet, plus an eight-story building of 249,000 square feet. Three parking garages of 11 or 12 levels would serve 3,700 cars.

The site will extend a path to a Caltrain station and Downtown South San Francisco, and include an acre for a possible fire station, according to a 15-year development agreement with the city. The agreement calls for public open space and $75 million in “impact fees” for public safety, library, parks, childcare and more.

A decade ago, Healthpeak launched a biotech building boom along the Peninsula with its Cove, a 1 million-square-foot development of seven buildings at Highway 101 and Oyster Point Boulevard.

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The publicly traded REIT now has eight life sciences developments in South San Francisco that make up 29 buildings with 3.5 million square feet, including the Cove and the 148,000-square-foot Nexus on Grand, completed last year.

But a two-year downturn for drugmakers brought on by higher interest rates and a Wall Street pullback from biotech has caused some developers to delay approved projects, according to the Business Times.

In December, however, the Nasdaq Biotechnology Index surged on news of mergers and acquisitions, new funding rounds, the approval of the first therapy based on CRISPR genome-editing technology and some solid clinical trial results.

— Dana Bartholomew