Alexandria to Build 550,000 SF Life Science Tower on Manhattan’s East Side

NEW YORK CITY—Alexandria Real Estate Equities, a Pasadena, CA-based REIT, and the City of New York have reached an agreement for the development of a 550,000 square-foot facility in Manhattan’s Kips Bay. Located at the southwest corner of 30th Street and FDR Drive, the building, called the North Tower, will complete the Alexandria Center for Life Science campus. Construction is scheduled to begin in 2020 with an expected completion by 2022.

“Our focus for the North Tower, which fits very well with the goals set forth by the NYCEDC and Mayor de Blasio’s administration, will be to further expand Alexandria’s innovative proprietary product offerings in this cluster,” says John H. Cunningham, EVP and New York City regional market director at Alexandria Real Estate Equities.

The North Tower will be designed to provide space for early-stage companies that come from leading academic and medical institutions, which create a majority of the demand in New York City, according to Cunningham.

With wet lab and office space, the new structure is described by NYCEDC president and CEO James Patchett as “building on the growing momentum of the city’s life science cluster and supporting the creation of nearly 1,500 quality jobs.”

Including the East and West Towers, the entire life science complex will provide more than 1.3 million square feet for offices, laboratories and tenant amenities to attract leading talent. This will include a food hall, event space, trendy restaurants such as a Tom Colicchio restaurant, an artisanal café, a large urban farm, a fitness gym and a shuttle to and from Penn Station.

The East and West towers, completed in 2010 and 2013, are now fully leased. Tenants include Bristol‑Myers Squibb, Eli Lilly and Company, Pfizer and Roche; and early-stage companies, Intra-Cellular Therapies, Kallyope and MeiraGTx Holdings. Two tenants, Lodo Therapeutics and Petra Pharma Corporation, were launched by Accelerator Life Science Partners, a company co-founded by Alexandria in New York City.

The facility is being designed to foster collaborations among academic institutions, medical centers and businesses. Along the East Side Medical Corridor, the center has easy access to the Alexandria Life Science Factory to be developed in Long Island City, Queens  and the Cornell Tech campus on Roosevelt Island.

Alexandria taps into the theory that geographic concentrations of interconnected companies and institutions increase productivity, drive innovation and stimulate company formation. Joel S. Marcus, executive chairman and founder of Alexandria Real Estate Equities, says New York City has already emerged as an early-stage market which generates medical technologies for commercialization.

The city’s LifeSci NYC program provides a 10-year, $500 million funding commitment to establish New York City as a life science R&D leader.

An NYCEDC spokesperson tells GlobeSt.com that the city gave the land at Kips Bay to Alexandria and it will be priced at fair market value according to an appraisal for a commercial life science building. There is a payment-in-lieu-of-tax schedule equivalent to a 25-year industrial and commercial abatement program (ICAP), which also applies to the East and West Towers.

The city offers a $300 million tax abatement incentive program and is updating its land use policy to facilitate life science real estate development. The NYCEDC spokesperson says that the high cost of lab construction has resulted in a shortage of space for new life science companies. The tax incentives are designed to lower barriers of entry for developers looking to build spaces for these types of businesses.