READINGTON, NJ-Merck & Co. pharmaceutical’s announcement last week that it will close its headquarters here and consolidate space at its existing facility in Summit may have caused more of a whimper than a bang in state real estate circles.
"When you think about it, when Merck acquired Schering-Plough you had two major pharmaceutical companies with their headquarters in New Jersey," Cushman & Wakefield’s Gualbarto “Gil” Medina was quoted as telling the Newark Star Ledger immediately after the announcement. "I suppose we should have all seen the fact that they’d consolidate in one place or another."
In a statement, Merck’s chairman and CEO Kenneth C. Frazier said the move would help the company “reduce the size of our operating footprint and increase agility as we adapt to our changing business environment." Frazier noted that Summit is closer to major transit hubs than the Whitehouse Station section of Readington in Hunterdon County, its current headquarters site.
Merck said it will begin a shut-down of the building it has occupied since 1992 within two years and company officials said it won’t mean a workforce cut. About 1,100 workers are supposed to move to Summit and another 900 employees would move to Merck offices in Branchburg and Tewksbury.
Overall, however, New Jersey has lost more than 20 % of its drug industry jobs in the last decade, according to census figures. The company has been slimming down space on a global basis - it has facilities in 70 countries – since the 2009 merger with Schering-Plough. That same year,
Nutley-based Roche began moving executives to its Genentech subsidiary in San Francisco; in June Roche announced it will close its 90-year-old plant on the Nutley/Clifton border. Also in 2009, Pfizer acquired Wyeth – and shut down its Princeton research center.
The “nation’s medicine chest,” as New Jersey was known, began changing shape and moving westward, as research development shifted from chemistry to bio-pharma, industry experts have observed.
Now, brokers are beating the bushes for large companies who can make use of some of the high-tech space that was left behind in the Garden State – be they pharmaceutical firms, high-tech, medical institutions, or whatever presents itself.
Earlier this month, M & M Partners of Clifton bought a former Wyeth property in Morris Plains with a plan to convert it to retail and housing. In Readington and Nutley, community officials say they have commitments from the departing drug makers to help them market the property for new uses. Roche has said it intends to clean up its property before selling it in 2015.
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