Three biotech space real estate investment trusts each have millions of square feet of space in the region, and more acquisitions are planned.
Rancho Bernardo-based BioMed Realty Trust (NYSE: BMR), Pasadena-based Alexandria Real Estate Equities (NYSE: ARE), and Long Beach-based HCP Inc. (NYSE: HCP) together own most of the life science space in San Diego County, as well as millions of square feet more in biotech hubs from Los Angeles to Boston.
BioMed Realty owns or has interest in U.S. properties comprising approximately 13.1 million rentable square feet, with much of this space being elsewhere -- such as the millions of square feet the REIT owns in the Cambridge/Boston area near Harvard University.
On Oct. 31, BioMed announced a 93,000-square-foot expansion and extension of a lease it has with Ironwood Pharmaceuticals (Nasdaq: IRWD) in Cambridge, Mass. The new contract brings Ironwood's total to 303,000 square feet at the location.
Earlier in October, BioMed announced that Regeneron Pharmaceuticals (Nasdaq: REGN) had signed an 80,500-square-foot lease expansion at the REIT's Landmark at Eastview Campus in Tarrytown, N.Y.
Closer to home, BioMed owns the 125,219-square-foot UTC Executive Plaza property at 4570 Executive Drive that is notable for its obelisk and reflecting pool. It paid $63.5 million for that asset in September 2010.
In 2011, BioMed completed constructing a 176,000-square-foot life science building for Isis Pharmaceuticals (Nasdaq: ISIS) at 2855 Gazelle Court in Carlsbad.
During the third quarter, BioMed executed 22 leasing transactions totaling approximately 367,400 square feet. The firm picked up 16 new leases and six lease renewals, including a transaction with Vertex Pharmaceuticals (Nasdaq: VRTX) for 81,200 square feet at the REIT's Torreyana Road property in Torrey Pines.
While BioMed's earnings are running behind last year's levels, Alan Gold, BioMed chairman and CEO, said in a statement that the company is primed for strong growth.
"We are proud to report that as a result of the third quarter leasing activity and our recently announced leases with Regeneron Pharmaceuticals in New York and Ironwood Pharmaceuticals in Cambridge, we have exceeded 1.8 million square feet of gross leasing volume, a full 150 percent of our five-quarter leasing goal with two months remaining in the year," Gold said.
For the quarter ended Sept. 30, BioMed posted $6.45 million in net income on $134.53 million in revenues -- compared with $8.93 million in net income on $114.64 million in revenues for the like period a year earlier.
For the nine months ended Sept. 30, BioMed recorded $3.5 million in net income on $379.39 million in revenues, compared with $26.76 million in net income on $326.24 million in revenues for the like period a year earlier. BioMed's stock price has ranged from $16.43 to $20.30 during the past 52 weeks.
Alexandria Real Estate Equities owns about 2.8 million square feet of life science space in San Diego County.
The REIT, which paid $128 million to acquire the 360,000-square-foot Nobel Research Center two years ago and promptly got Illumina Inc. (Nasdaq: ILMN) to sign a $335 million, 20-year lease, has many more large and high-profile properties here. Illumina is also expanding into an adjacent 123,400 square feet building constructed for its use.
Another notable property owned by Alexandria is a 449,759-square-foot building at Campus Pointe in the University Towne Centre submarket. Tenants there include the University of California, San Diego, Celgene Corp. (Nasdaq: CELG) and Eli Lilly & Co. (NYSE: LLY). Alexandria paid $113.5 million for the property in December 2010.
As of June 30, 2012, Alexandria had a total of 182 properties aggregating about 16.9 million rentable square feet. Its properties were 92.9 percent leased as of June 30.
Alexandria posted $76.72 million in net income on $431.9 million in revenues for the nine months ended Sept. 30, compared to $99.93 million in net income on $408.98 million for the comparable period a year earlier. Alexandria's stock price has ranged from $61.65 to $77.10 during the past 52 weeks.
Alexandria and BioMed may be profitable, but both are dwarfed by the balance sheet of HCP Inc.
HCP posted $199.04 million in net income on $475.48 million in revenues for the quarter ended Sept. 30, compared to $175.47 million in net income on $441.23 million in revenues for the like period a year earlier. For the nine months ended Sept. 30, HCP recorded $600.58 million in net income on $1.39 billion in revenues, compared with $483.7 million in net income on $1.25 billion in revenues for the comparable period in 2011. HCP's stock price has ranged from $35.83 to $47.75 during the past 52 weeks.
The CoStar Group (Nasdaq: CSGP) identifies about 48 buildings with millions of square feet of space in the greater San Diego region that are owned by HCP. These include life science buildings, senior housing and care facilities and medical office buildings, among others.
Some of HCP's assets include the 117-bed Oakmont of Escondido Hills nursing home, the 160-bed Brighton Gardens assisted living facility in Carlsbad, a 125,000-square-foot industrial building in the Parkway Business Center in Poway, a nine-acre parcel for a proposed 160,000-square-foot industrial building in the Parkway Business Center, a 2.55-acre parcel and a 2.99-acre parcel for future development along Science Center Drive in Torrey Pines, as well as a planned 121,513-square-foot office building within the Sorrento Summit plan in Sorrento Mesa.
Earlier this month, HCP announced it would be acquiring 133 senior housing facilities from a joint venture of Emeritus Corp. (NYSE: ESC) and the Blackstone Group (NYSE: BX) for $1.73 billion. Emeritus will continue to operate the assets and plans $30 million in overall upgrades. The 133 senior housing properties being acquired are in addition to 250 senior housing assets and 45 skilled nursing facilities the REIT already owns.