A merger between the second and sixth largest employers in Massachusetts’ all-important life science industry typically would cause indigestion in commercial real estate and economic development circles. 

So why is nobody reaching for the Zantac about Takeda Pharmaceuticals’ pending $62 billion takeover of Irish drugmaker Shire, given Shire’s more than 3,000 Bay State employees and 2 million square feet of occupancy in Cambridge and the suburbs? 

“If you look at why all of the companies are coming here, they’re coming to access innovation and world-class talent,” said John Hallinan, chief business officer for the Massachusetts Biotechnology Council. “They’re coming here to expand.” 

Tokyo-based Takeda wasted little time affirming its commitment to Massachusetts. The company said this month it’s planning to move its 1,000-employee U.S. headquarters from suburban Chicago to Greater Boston once the merger is complete, pending a series of regulatory approvals. 

Takeda has not announced a location. But real estate sources speculate that it could ultimately occupy the 350,000-square-foot former Genzyme headquarters at 500 Kendall St., which Shire had already leased effective Aug. 1 as it expands its Cambridge presence. 

Fresh uncertainty about the future of that trophy property has been kindled by recent reports that Shire had halted its tenant buildout and planned occupancy. 

“Could Takeda come in and take that as their headquarters?” said Aaron Jodka, director of research for Colliers Boston. “It’s a leased asset, so it just goes from entity to another. Time will tell, but right now there aren’t many large blocks of existing space in Greater Boston for a 1,000-person operation.” 

A spokesman for landlord Biomed Realty said Shire’s occupancy is on track. 

“We can confirm that Shire is set to be the sole tenant at 500 Kendall St.,” spokesman Rick Howe said via email. 

Shire spokeswoman Katie Joyce reiterated a statement that the company “has decided to stop the build-out and planned occupancy of the building” to minimize disruption for employees who would be relocated, but said the lease is still in place. 

Two real estate industry sources said it’s likely the space will be filled by the combined Takeda-Shire entity. 

“Shire has ceased their buildout, which makes sense given the pending acquisition, because they’re not going to be making the decisions,” said a broker active in the Cambridge market. “But the building is not being actively marketed or shown to prospective tenants. It could very well be occupied by Takeda.” 

Steve Adams

A second broker said Takeda executives have indicated no final decision will be announced until early 2019, after the merger is approved. 

Takeda already has a significant presence in Cambridge as the home of its global oncology, vaccines and R&D units. Shire, which has a large campus in Lexington, subleased 223,000 square feet at Alexandria Real Estate Equities’ 125 Binney St. in 2017 to increase its Cambridge presence. 

If Takeda-Shire negotiates an early termination or opts to sublease 500 Kendall St., a line of companies would likely seek to take its place. 

Colliers is tracking 3 million square feet of life science requirements in Greater Boston, and the vacancy rate in the 11.3-million-square-foot East Cambridge lab market was just over 2 percent at mid-year. 

Sanofi, the state’s largest life science company with 4,800 employees, is moving to a brand-new 251,000-square-foot headquarters at 50 Binney St. this year. But it’s simultaneously scouting additional sites, according to real estate sources, including Massachusetts Institute of Technology’s 343,000-square-foot speculative project at 314 Main St. 

Human Capital Outweighs Tax Breaks 

The massive space requirements reflect an industry that’s increasingly clustering in a handful of coastal metros with deep pools of scientific talent. And recent research indicates that Greater Boston’s already dominant position – with the nation’s most life science doctorate degrees awarded annually – is strengthening. 

The life industry employs nearly 70,000 people statewide, a 28 percent growth rate over the past decade, including nearly 36,000 positions in the high-paying R&D sector, according to the Massachusetts Biotechnology Council. 

Massachusetts companies scoop up more than a third of all venture capital biopharma investments, according to PwC’s Money Tree survey, including $2.7 billion in the first half of 2018. That’s just shy of the $3.1 billion that Massachusetts biopharma companies received in all of 2017. 

The industry’s relentless space needs have encouraged lab development and conversions of former office space from Boston and Cambridge to MetroWest. Developers have added 12 million square feet of new lab space in Massachusetts since 2009, bringing total inventory up to 29 million square feet, according to research by Colliers and CBRE. 

Proximity to universities and research clusters are the biggest factor when life science companies pick a location, according to a survey of JLL clients. The competition for elite researchers outweighs government incentives, MassBIO’s Hallinan said, noting that Alexion Pharmaceuticals and GE Healthcare Life Sciences moved their headquarters from Connecticut and New Jersey, respectively, to Massachusetts in recent years without any state incentives. 

“We have a large number of drug discovery companies and I consider them the sellers of innovation,” Hallinan said. “The buyers are coming here to access that.”