Reservoir Woods East
Life science properties’ resistance to the work-from-home model paid off for developer Alexandria Real Estate Equities in the third quarter.
Alexandria reported funds from operation of $1.83 per share, meeting Wall Street analysts’ expectations. Net income rose nearly 40 percent to $545 million.
In an earnings release, the Pasadena, California-based REIT touted its tenants’ leadership in the COVID-19 research area. Nearly 100 companies leasing space at its R&D facilities are involved in the search for a vaccine and treatments, while tenants AstraZeneca, Moderna and Pfizer have vaccine candidates in late-stage clinical development.
The life science sector continues to attract strong inflows of venture capital funding, generating demand for expansion in a handful of coastal industry clusters including Greater Boston. Alexandria owns 70 properties in Greater Boston spanning nearly 8.6 million square feet, with an occupancy rate of 98.3 percent, which account for 36 percent of the company’s annual rental revenues.
All of the companies’ properties have remained open during the pandemic, and Alexandria has said it has put in place “cutting-edge initiatives” to protect employees from the virus including disinfectant cleaning and improved air filtration. Alexandria collected 99.7 percent of its rents during the third quarter across its national portfolio of 326 properties spanning 31.2 million square feet.
Locally, Alexandria is increasingly looking to the western suburbs for development opportunities including its acquisition of the 760,000-square-foot AthenaHealth campus in Watertown last December for $525.5 million, and the purchase of the former Mount Auburn Club property for $32.6 million. Alexandria has a 75 percent ownership interest in the property, acquired in a joint venture with National Development.
And in August, Alexandria acquired the 313,000-square-foot Reservoir Woods East campus in Waltham for $330 million, where it plans to convert the office buildings into lab space and has approvals to build another 440,000 square feet of office-lab space as of right.
