Longfellow Secures $203M Loan for San Diego Life Science Project

Longfellow Real Estate Partners has secured $203M in construction loan financing for Bioterra, its 316K SF life science campus in San Diego.

Square Mile Capital Management and Bank OZK provided the financial package, which was arranged by JLL Capital Markets.

According to a statement released by Square Mile Capital Management Director Tom Burns, the Bioterra project fills the need for purpose-build lab facilities in strong life science markets like San Diego.

Square Mile this year also provided a $193M construction loan for a 208K SF life-science project in Somerville, MA, and a $155M loan to a Longfellow venture for the conversion for lab use of an office building in Long Island City in Queens.

Bioterra, which broke ground in August, will be a six-story campus including lab and office space over a three-story underground parking facility. The life-science facility will feature all-electric HVAC, with amenities including a fitness center and a coffee bar.

The campus will be built on a site at the intersection of Oberlin Drive and Mira Mesa Boulevard in the Sorrento Mesa submarket about 15 from downtown San Diego.

The development is in proximity to Mesa Biotech, Scripps Memorial Hospital La Jolla and the University of California San Diego.

In Long Island City, Square Mile is financing the repurposing of a 218,000K SF building into a life science facility that will be called Hatch Life Sciences is underway. Completion is expected in the second quarter of 2023.

Longfellow, in partnership with Sculptor Real Estate, purchased for $93M a majority stake in the property in 2021, with plans to invest an additional $120 million into the building’s conversion to lab use.

In Somerville, Square Mile is financing North River Leerink, a life science and healthcare real estate-focused joint venture between North River Co. and Leerink Development centered on a four-story life science campus at 100 Chestnut, in Somerville’s historic Brickbottom District, a deal that was arranged by Colliers.

In Cushman & Wakefield’s October 2022 Life Sciences Outlook, Seattle (27%) and San Diego (31%) saw double-digit rent growth from the end of 2021 through the end of the second quarter.

C&W said three US markets saw asking rents fall from year-end levels: Boston (-4.5%), the Bay Area (-3.3%) and New Jersey (-1.2%). Still, rents are higher than at year-end 2019.

Overall vacancies were low in most markets and below 10% in six U.S. markets in the brokerage’s October report: Los Angeles (1.8%), suburban Maryland (3.5%), Seattle (3.8%), Philadelphia (5%), San Diego (5.7%) and Boston (9.1%). Sublease space is not a significant factor in the vast majority of US life science markets, the report said.