FibroGen, faced with steep job losses, will buy its way out of a 234,200-square-foot lease for its life science headquarters and labs in San Francisco’s Mission Bay.
The locally based drug maker will pay $10 million to landlord Alexandria Real Estate Equities to exit its lease at 409 Illinois Street, the San Francisco Business Times reported.
The one-time payout covers past rent for the company’s headquarters next to the Golden State Warriors’ Chase Center arena, plus a lease modification.
The lease now expires at the end of the year — four years earlier than planned when the company re-upped in 2021. It’s not clear where the biotech firm is headed.
FibroGen, which had initially signed a 15-year lease for the offices in 2006, was among the first companies to commit to making Mission Bay a biotech hub, according to the Business Journal.
Founded by the late Thomas Neff in 1993, the company has lost $1.9 billion since its inception.
This summer, the firm said it would be forced to cut more than 300 jobs, or three-quarters of its U.S. workforce, after a key drug for pancreatic cancer failed two clinical trials. The company last year cut 100 jobs after the same drug failed clinical trials for two other diseases.
FibroGen now focuses on developing a drug targeting prostate cancer and the commercialization of its one approved drug for chronic kidney disease.
Eighteen years ago, the company set aside a portion of its labs in Mission Bay for two dozen life science startups, creating a de facto incubator. FibroGen didn’t respond to a request from the Business Times to clarify what will happen to startups that have subleased space.
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The pending vacancy at the Mission Bay offices owned by the Pasadena-based REIT comes during a glut in the national life sciences market. Last year, Alexandria sold more than $700 million in non-core properties, and was poised to peddle $1 billion more.
In the quarter ending in June, the Bay Area’s once-booming 41.5 million-square-foot life sciences market was 24.6 percent vacant, according to CBRE.
— Dana Bartholomew