Tenant: Federal Drug Administration www.fda.gov
Developer and Buyer: Easterly Government Properties Inc.
Biotechnology Research Laboratory – 1431 Harbor Bay Parkway
Alameda, CA 94502 – 80,000 square feet
Our client, Easterly Government Properties, Inc., was looking to purchase a large flex building in the East Bay for the purposes of building out a Class-A laboratory. The location would be the FDA’s new field headquarters in the Bay Area, leased to the agency by Easterly, a specialist in Government leasing and development. Easterly currently controls about 8,500 leases to government entities, comprising more than 200 million square feet.
Probably our biggest challenge with this project was not just finding a suitable flex building for purchase, but the extremely long due diligence period that would follow. Given current market conditions, identifying an appropriate building was a challenge in itself. Cannabis had just been legalized in California, so flex assets were in high demand and very difficult to come by.
To add to the complexity, the building needed to be expanded by an additional 20 percent, so we had to be sure the expansion would proceed without a hitch. Other challenges included a requirement that the building to be located close to other research facilities and universities to facilitate a more efficient recruiting process.
The Challenges
1
Finding a suitable flex building for purchase
2
Extremely long due diligence period
3
Building needed to be expanded by an additional 20%
Our Approach
We crafted a scope of services that was in-line with the FDA and Easterly’s stated goals.
Given IPG’s extensive experience in life science development, we were able to provide basic brokerage services as well as development advisory services for a Class-A laboratory conversion of the building in question, an industrial flex asset in the East Bay.
The Outcomes
We secured a flex building for Easterly that was located just a block away from the FDAs current location. Originally owned by a company that manufactured medical instruments, it was sitting empty as the owners had planned to expand into the space. We were able to negotiate with them to craft a deal that was equitable for all parties.
The building itself was ideal to both buyer and tenant. It was closer in size to what the FDA needed and because it was in the same area as their previous location, it also meant that their recruiting and other logistical processes would not have to change significantly.
The original building was 65,810 square feet, while the new location was almost exactly what the client was looking for. In the end, the new location only had to be expanded by 5,000 square feet to satisfy the tenant’s space requirements.
The Success
1
Securing a new flex building, just a block away from FDA's current location
2
No disruptance in recruiting and logistical processes
3
New location was exactly what client was looking for
