Life Sciences New York | 2017

An evolving industry: Today’s clusters creating tomorrow’s breakthroughs JLL Research

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Life Sciences Outlook | New York | 2017

New York New York City is emerging as a leading destination for biotech startups and the larger life sciences industry.

Investors have committed billions of dollars throughout the city and metro area to fuel growth in the life sciences and attract top talent.

Major lab supply: Clusters of established lab stock with long-time industry presence

287 95

80 95

Bronx 495

Queens

Emerging lab supply: Areas with limited lab stock today that are poised for growth

Brooklyn

78 95

Staten Island

Life Sciences manufacturing supply: Clusters of manufacturing space devoted to pharmaceutical, biological or medical device & instrument manufacturing

New York New York City is an emerging destination for life sciences tenants, as the local economy continues to diversify and embrace new industries. According to the local Economic Development Corporation, the city is home to one of the nation’s largest concentrations of medical centers, research foundations and academic institutions. The life sciences scene in New York City is also bolstered by its close proximity to other biotech enclaves in the greater metro area—namely New Jersey, Long Island and Westchester County.

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Scorecard Life Sciences Outlook | New York | 2017

Economic

New York City’s life sciences cluster continues to grow thanks to support from the NYC Economic Development Corporation (NYCEDC) and the local government. The city has launched a number of initiatives to fuel the life sciences industry.

Workforce Total life sciences Employment 14,275 Establishments 1,087 Funding VC funding NIH funding

Inventory

New York City’s direct access to capital as a leader in global finance and its rich talent pool contribute to its status as an ideal tenant destination. A diverse economic landscape and proximity to the booming tech sector have also created unique opportunities for innovation among life sciences tenants.

33.7

Cluster score:

Total life sciences $354.0m $1.63b

% To total U.S. 3.5% 6.6%

Total supply 2.8M s.f.

% Total vacancy 22.1%

Year-over-year growth 2.8% 4.2%

Average asking rent (NNN) $31.77 p.s.f.

Life sciences employment composition 1% 4%

10% 3%

36%

Pharma & medicine manufacturing Electromedical instrument manufacturing Medical equipment & supplies manufacturing Testing laboratories

non-lab using

Life sciences employment 14,275 lab using

46%

Industry giants like Roche, Pfizer, and Eli Lilly have established footprints in the city, and the BLS estimates that more than 1,000 other life sciences companies are located throughout the New York area.

% Life sciences to private employment 0.4% 0.4%

Research & development Medical & diagnostic laboratories

Life sciences establishment composition 2% 3%

Pharma & Medicine MFG 23%

40%

Life sciences establishments 1,087

Electromedical Instrument MFG Medical Equipment & Supplies Testing Laboratories

4%

R&D Medical & Diagnostic Laboratories

28%

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Life Sciences Outlook | New York | 2017

New York Manhattan

100 percent of lab space is occupied • While overall vacancy in Manhattan’s office sector hovers near 10 percent, its 1.3 million square feet of lab stock is fully occupied. Demand from the city’s budding life sciences industry has outpaced lab supply in Manhattan. • In response, the city has launched LifeSci NYC, an initiative that will allocate $100 million towards the creation of an applied life sciences campus that will ultimately serve as the industry’s anchor. The new campus will be in addition to the one already under construction on Roosevelt Island by Cornell Tech. • LifeSci NYC has also pledged $300 million in tax incentives for investors who commit to building affordable commercial lab space. • In the meantime, life sciences tenants are adapting office space for their purposes or turning to coworking providers. Intercept Pharmaceuticals recently committed to 49,143 square feet of interim space at 10 Hudson Yards. It will move to 82,275 square feet at 55 Hudson Yards once construction is complete. Brooklyn

More than 600,000 square feet available for lease • In contrast to Manhattan, lab vacancy in Brooklyn is currently at 42.2 percent, down 23.2 percentage points over the year. • A large block totaling 398,000 square feet is available at BioBAT, a state-of-the-art biotech facility in the Brooklyn Army Terminal. • 209,800 square feet of space is available for lease at 630 Flushing Avenue, the former Pfizer Building.

Facilities scorecard Supply

Manhattan

Brooklyn

Rentable lab stock Owner occupied lab stock (% of total lab stock)

1.3M s.f. 15,660 s.f. 47.6%

1.5M s.f. 0 s.f. 52.4%

Total vacancy (Change year-over-year)

0.0% -2.4 ppts

42.2% -18.6 ppts

0

2

2.1M s.f.

0 s.f.

-

$31.77 p.s.f. +23.2%

# of large blocks over 50,000 s.f. Under construction (s.f.) Pricing Average asking rent (NNN) (Change year-over-year)

Recent activity Intercept Pharmaceuticals Hudson Yards 10 Hudson Yards 49,143 s.f. 55 Hudson Yards 82,275 s.f.

BioBAT Brooklyn Army Terminal Building A 140 58th Street 398,000 s.f.

JLABS @ NYC (Johnson & Johnson Innovation) New York Genome Center 101 Avenue of the Americas 30,000 s.f.

Cornell Tech Tech & Applied Sciences Campus Roosevelt Island 2.1M s.f. Phase 1 delivery: 2017

Activity key:

Leasing Sales Under construction Large blocks of space

Want to know more? Contact:

Roger Humphrey Executive Managing Director Life Sciences +1 (908) 698-2867 [email protected]

Richard McBlaine International Director Corporate Client Development +1 (312) 228-2793 [email protected]

Dan Loughlin Managing Director Brokerage, New Jersey +1 (973) 939-3869 [email protected]

Lisa Strope Director, New England Research Americas Research +1 (617) 531-4243 [email protected]

Wes Simon Analyst, Boston Research Americas Research +1 (617) 531-4216 [email protected]

Megan Shields Analyst, Boston Research Americas Research +1 (617) 531-4243 [email protected]

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