CBRE
Global Research and Consulting
New York City Life Sciences
Focus on Biotechnology Research Space
Summer 2013
Introduction
Spring 2013
New York City has emerged as a recognized hub in the
global biotechnology industry, and its commercial research
laboratory real estate footprint continues to grow as
companies increasingly choose the city to reap the benefits
of its academic medical centers, incentive programs and
innovative environment.
New York City Life Sciences | Focus on Biotechnology Research Space
There is already an estimated 1.7 million sq. ft. of existing
biomedical research space in New York City, with an additional 1.1 million sq. ft. in the development pipeline. These
totals are expected to only increase as incentives and funding
continue to lure companies to the city. Incentives for companies and developers range from tax credits and awards of up
to $250,000, to programs that allow for as much as $1.0
million in financing. Biotechnology venture capital funding to
the area also increased 25% year-over-year during 2012.
The most recent statistics from the New York City Economic
Development Corporation (NYCEDC) indicate that biotechnology employment in New York City increased 3.2% over
the previous year, compared to the 0.6% national growth
rate for the industry. The Department of Labor reported
that employment for Life Scientist occupations in the U.S. is
expected to grow 20% by 2020, compared to an average of
14% for all occupations, which could translate into thousands
of additional jobs for the city.
Audubon Biomedical Science and
Technology Park
• 166th Street and Broadway,
Manhattan
• Mary Woodard Lasker Biomedical
Research Building, 60,000 sq. ft., built
in 1995
Courtesy of
Columbia University
• 46 companies started
• 600 jobs created
New York City’s academic medical research environment spins
around 20 start-up biotech companies out of the city’s universities each year, according to Mayor Michael Bloomberg. In
the past, these firms chose markets such as San Francisco or
Boston because of the lack of affordable incubator space and
a life sciences community in the city. However, over the past
several years this trend has begun to change.
Although most of the Audubon Biomedical Science and
Technology Park will be used by Columbia University,
the Mary Woodard Lasker Biomedical Research Building
was built specifically for commercial use. Among the 15
biotech tenants in the building are Exosome, Intra-Cellular
Therapeutics, The New York Stem Cell Foundation,
Oligomerix and PIN Pharma.
Research Facilities
Brooklyn Army Terminal (BioBAT)
Although commercial laboratory facilities are sparse in New
York City, some key projects have helped shape the footprint
of the industry.
Alexandria Center for Life
Science | New York City
• Developed by Alexandria Real Estate
Equities, Inc.
• 1.1 million sq. ft. total planned
• Sunset Park, Brooklyn
• Former WWII armory renovated in
2008, originally built in 1919
• 500,000 sq. ft. total planned
• 38,000 sq. ft. completed, 85,000 sq.
ft. under construction
• East River Science Park, East 29th
Street, Manhattan
Source: NYCEDC
• $60 million in city and state funding
Courtesy of Alexandria
Real Estate Equities, Inc.
• First Tower, 310,000 sq. ft., built in 2010
• Second Tower, 410,000 sq. ft., under construction
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Click above to watch Pamela Murphy, Senior Vice President, Eastern
and Central U.S. Research, discuss the emergence of New York City
as a competitive biotechnology industry hub.
The Alexandria Center for Life Science serves as an incubator
for the life sciences community. Construction on the second
tower began after Roche agreed to an 11-year lease for
60,000 sq. ft., where it will house its Translational Clinical
Research Center. Other tenants include Lilly Oncology and
ImClone Systems (both subsidiaries of Eli Lilly), Firmenich,
Kadmon Pharmaceuticals, NYU Langone Medical Center and
Pfizer Centers for Therapeutic Innovation.
Life Sciences:
Companies in the fields of biotechnology, pharmaceuticals, biomedical technologies, life systems technologies,
biomedical devices and organizations and institutions that
devote the majority of their efforts in the various stages
of research, development, technology transfer and commercialization. —Empire State Development Corporation
Biotechnology:
Any technological application that uses biological
systems, living organisms, or derivatives thereof, to
make or modify products or processes for specific use.
—United Nations Convention on Biological Diversity
© 2013, CBRE, Inc.
Advanced Biotechnology Park at
SUNY Downstate Medical Center
1.7 million sq. ft. of biomedical research space (with an additional
1.1 million sq. ft. planned or under construction)
11 major academic medical research institutions
5 biology Ph.D. programs
• Flatbush, Brooklyn
535 biomedical engineering graduates per year
• Built in 2004
Source: SUNY Downstate
Medical Center
118 Nobel Laureates
The Biotechnology Incubator contains lab sizes varying
between 400 and 1,200 sq. ft. There are 15 biotech space
users in the park, including BioSignal Group.
115 biotech companies
New York Genome Center
$1.3 billion of NIH funding annually (#2 in U.S.)
• 101 Avenue of the Americas,
Manhattan
72 hospitals
Source: New York City Economic Development Corporation, 2013.
• 170,000 sq. ft. total, 60,000 sq. ft.
of lab space
• Construction began July 2012
Source: CBRE Research
• Labs projected to open late 2013
Since 101 Avenue of the Americas was built in 1992,
traditional office users have occupied a majority of the
Hudson Square tower. In 2011, the New York Genome
Center (NYGC) signed on to be the anchor tenant.
Brooklyn Navy Yard - Building 77
• Wallabout Bay, Brooklyn
• 1.0 million-sq.-ft. renovation to be
completed in late 2014
• $80 million raised through private and
public investment
Courtesy of Beyer Blinder
Belle Architects &
Planners LLP
The Brooklyn Navy Yard Development
Corporation raised $60 million through the federal EB-5 program to create a biomedical technology hub in Building 77.
Shiel Medical Laboratory invested $20 million for 240,000
sq. ft. in the project, 60,000 sq. ft. of which will be used for
its medical labs with the remaining 180,000 sq. ft. to be
leased out to other companies in the sector.
Development Considerations
In New York City, developers are confronted with two key
issues when considering the construction of modern laboratory space: zoning laws and capital costs.
Zoning Laws
Zoning laws require research laboratory space to be in
manufacturing districts. Specifically, work done in this industry
requires Use Group 17 (which permits chemical compounding and packaging, creation of pharmaceutical products and
medical appliances, laboratories, research, experimental or
testing facilities) and is permitted in manufacturing districts.
These are most common in the outer boroughs, although
they exist within Manhattan in areas such as the Garment
District, SoHo and Clinton/Hudson Yards. Although it’s
© 2013, CBRE, Inc.
130 venture capital funds investing in healthcare
possible for the City Planning Commission to rezone nonmanufacturing districts, the process has additional political,
demographic and economic considerations.
Capital Costs
Depending on the type of space being developed, the
cost of constructing research lab space can range from
$300 to $600 per sq. ft. (excluding the cost of equipment,
architectural and design services, permits and legal fees),
compared to $50 to $150 per sq. ft. for traditional office
space build-outs.
Although renovations usually cost less than new construction, they present their own obstacles. Buildings must have
proper ventilation, ceiling heights and structural support,
and unforeseen costs may accrue as the project progresses.
There are also strict requirements by the Food and Drug
Administration on air delivery, ventilation, process control
systems, etc. Renovation of existing space into laboratory
space has the added economic benefit of bringing new life to
commercial properties that may otherwise have low desirability among traditional users.
New York City Life Sciences | Focus on Biotechnology Research Space
• 24,000 sq. ft. completed, 26,000 sq.
ft. under construction
Figure 1: New York City Biotechnology Quick Facts
Spring 2013
Building A of the Brooklyn Army Terminal was redeveloped
with the biotechnology industry in mind. The International
AIDS Vaccine Initiative signed as the anchor tenant when the
project opened. Speculative-built lab space is under construction, with the remaining space available to be leased.
The areas of the city that have already seen development,
such as Brooklyn and the east side of Manhattan, should
continue to attract developers because of the existing
presence of the biotechnology community. Additional
areas for potential future development may include sites in
existing manufacturing districts, or close to major academic
institutions and healthcare facilities.
Academic Medical Institutions
One of New York City’s most attractive features for biotech
companies is the city’s world-class academic medical
research institutions. Nine of the top 50 universities on the
American Research Universities Report, published by The
Center for Measuring University Performance, are located in
New York City. Also, New York City has three of the country’s
top 15 hospitals on the U.S. News and World Report Best
Hospitals 2013 list. With the exception of Boston, which has
3
Figure 2: New York City Biotechnology Incentives
Program
Description
Spring 2013
Biotech companies with fewer than 100 employees (75% or more must work in NYC) that meet
certain financial limitations can claim a $250,000 refundable tax credit per year to be used for
facilities, operations and training. Tax Credit expiration is January 1, 2016. Can be claimed for
three consecutive years.
NYC Biotech Tax Credit
New York City Life Sciences | Focus on Biotechnology Research Space
Partnership Fund for New York City
and NYCEDC Investment Fund –
BioAccelerate NYC Prize
A citywide competition that awards up to $250,000 in grant funding to those whose work has
proven potential, but has not reached the point of commercialization.
A loan funding program designed to aid bioscience companies interested in establishing their
operations and building out lab space at the East River Science Park. The $15 million fund allows
for loans up to $1 million per firm at attractive terms.
NYCIF East River Science Park
Lab Space Loan Fund
A New York Academy of Sciences initiative that connects scientists working within biotech and
related fields with venture capitalists to fund their research.
Life Sciences Angel Network (LSAN)
Source: New York City Economic Development Corporation, City of New York, Partnership Fund for New York City, New York Academy of Sciences.
two hospitals on the list, no other metropolitan area has
more than one. Five New York City medical schools also
landed on its Best Medical Schools for Research top 50 list.
This environment creates research that spins start-up biotech
companies out of the city’s academic medical institutions.
Contrary to Boston and San Francisco, where dozens of
private companies are often associated with each academic
center, companies in the city have the opportunity to be
the dedicated partner of an academic medical institution
because of the lower volume of candidates for partnership.
Incentives/Funding Sources
New York City provides a range of credits and incentives to
support biotech companies, including the recently extended
Biotechnology Tax Credit, which awards an estimated $2
million in credits annually. All of the programs specific
to the city for the industry are summarized in Figure 2. In
addition to these local industry-specific programs, there are
broader city, state and federal incentives that can be taken
advantage of. Also, the NYCEDC creates new programs
and initiatives to stimulate the biotechnology sector, which
contributed to the completion of the Alexandria Center for
Life Science and BioBAT.
Funding from venture capital sources for the industry also remains active in the area. According to
PricewaterhouseCoopers, there was $262 million in
biotechnology venture capital activity reported in the New
York metropolitan area during 2012, up from $209 million
in 2011 and $177 million in 2010. This 25% year-overyear increase trailed only the Midwest region (30%) for the
largest annual increase last year, while the larger, more
established regions of Silicon Valley and New England
posted declines in biotechnology investment of 14% and
24%, respectively.
New York City is one of the annual leaders in funding received from the National Institutes of Health (NIH). According
to the NYCEDC, the city receives $1.4 billion annually in NIH
funding, ranking it #2 in the country. Moving forward, the
NIH estimates its budget to be cut by $1.5 billion, or 5.1%,
pending the result of the 2013 federal budget sequestration
cuts, although the extent and impact of the potential cuts on
funding in the city is yet to be determined.
Figure 3: Biotechnology Venture Capital Funding
Total (Billions)
2011-2012 % Change
2012
$1.4
2011
2010
Midwest
$1.2
$1.0
NY Metro
$0.8
$0.6
San Diego
$0.4
$0.2
NY Metro
Midwest
San Diego
Silicon Valley
New England
$0.0
Silicon Valley
4
New England
-30%
-20%
-10%
0%
10%
20%
30%
40%
Source: PricewaterhouseCoopers MoneyTree, 2013.
© 2013, CBRE, Inc.
– Marc Tessier-Lavigne, Ph.D., President, Rockefeller University
The continuation of city and state initiatives and incentive programs are crucial to promote the city as a viable
destination for biotechnology research, along with additional
creative solutions that minimize the challenges to develop
suitable space. Recent history indicates that existing challenges are not impossible to overcome, and the city’s
evolving commercial real estate landscape is becoming more
accessible to the sector. Increased supply of new laboratory
space, whether through continued development of new
buildings or renovation of existing space undesirable to other
industries, will further attract biotech companies to the city.
Summary
Growth of the biotechnology industry and the demand for
space it creates would have a positive economic impact on
New York City. It would attract higher-paying jobs to the city
and help drive an increase in construction activity, leading
to a more modern, dynamic and diversified commercial real
estate market.
The city’s entrepreneurial spirit is evident in the New
York metropolitan area’s high volume of patent activity
each year. According to the U.S. Patent and Trademark
Office, an average of 4,920 patents were filed annually
over the last five years in the area, ranking slightly ahead
of San Francisco, at 4,890, and significantly ahead of
Boston, at 3,400. The New York area also outperformed
the other two regions in biotechnology-specific patents,
with an average of 1,040 filings over the last five years,
compared to 850 in San Francisco and 720 in Boston.
With an entrepreneurial environment and a large concentration of universities and medical centers that attract
some of the world’s best talent, New York City is well
positioned to become a national leader in biotechnology
research and development.
Figure 5: New York City Biotechnology Industry
Organizations
Figure 4: Patent Filings
Biotechnology Patent Filings, 5-Year Average
New York Academy of Sciences (NYAS)
New York
NewYorkBIO, formerly New York Biotechnology Association (NYBA)
New York City Life Sciences | Focus on Biotechnology Research Space
Patent Information
Spring 2013
“New York City is an emerging biotechnology market, and key seeds have been planted for further growth. The industry looks
to the city as an option because of the mass of excellent research in its academic medical centers and the breadth of its medical
facilities, as well as demographic factors such as the high education level of the talent pool and affordable housing in the region.
The city is a ripe new territory for biotechnology, and a wider range of commercial lab space, additional incentives and funding
sources, and a unified front from the academic medical centers would make it an even more attractive market, with the potential
of becoming a major bioscience hub alongside Boston and San Francisco.”
Center for Biotechnology (CFB)
San Francisco
LabToWallStreet (L2WS)
New York State Foundation for Science, Technology and
Innovation (NYSTAR)
Boston
New York Structural Biology Center (NYSBC)
0
200
400
600
800
1,000
1,200
New York Structural Genomics Research Center (NYSGRC)
Source: U.S. Patent and Trademark Office, 2013.
NYC Bio
Source: CBRE Research, 2013.
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© 2013, CBRE, Inc.
Figure 6: Academic Medical Institutions and Biotechnology Research Centers
Spring 2013
City College of New York
- Structural Biology Center
Sophie B. Davis School of
Biomedical Education - CUNY
Columbia University
Medical Center
89 Convent Avenue
New York, NY
160 Convent Avenue
New York, NY
630 West 168th Street
New York, NY
New York City Life Sciences | Focus on Biotechnology Research Space
Mount Sinai Icahn
School of Medicine
Audubon Biomedical Science
and Technology Park
1428 Madison Avenue
New York, NY
3960 Broadway
New York, NY
Memorial Sloan-Kettering
Cancer Center
Albert Einstein College of Medicine
1275 York Avenue
New York, NY
1300 Morris Park Avenue
Bronx, NY
The Rockefeller University
Hospital for Special Surgery
1230 York Avenue
New York, NY
535 East 70th Street
New York, NY
Alexandria Center
for Life Science | New York City
Weill Cornell Medical College
450 East 29th Street
New York, NY
445 East 69th Street
New York, NY
New York Genome Center
Cornell New York City Tech
101 Avenue of the Americas
New York, NY
Roosevelt Island, NY
NYU School of Medicine /
NYU Langone Medical Center
550 First Avenue
New York, NY
College of Staten Island - CUNY
2800 Victory Boulevard
Staten Island, NY
Advanced Biotechnology Park at
SUNY Downstate Medical Center
760 Parkside Avenue
Brooklyn, NY
KEY
Academic Medical Institutions
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Brooklyn Army Terminal (BioBAT)
Brooklyn Navy Yard - Building 77
140 East 58th Street
Brooklyn, NY
63 Flushing Avenue
Brooklyn, NY
Biotechnology Research Centers
Source: CBRE Research, 2013.
© 2013, CBRE, Inc.
Spring 2013
For more information regarding this local report, please contact:
Matt Maison
Manager, Research and Analysis
t: +1 212 984 8154
e: matt.maison@cbre.com
Enkeleda Gjeci
Research Analyst
t: +1 212 656 0531
e: enkeleda.gjeci@cbre.com
Michael Slattery
Research Analyst
t: +1 212 656 0583
e: michael.slattery@cbre.com
New York City Life Sciences | Focus on Biotechnology Research Space
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Disclaimer
Information contained herein, including projections, has been obtained from sources believed to be reliable. While we do not doubt its accuracy,
we have not verified it and make no guarantee, warranty or representation about it. It is your responsibility to confirm independently its accuracy
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cannot be reproduced without prior written permission of the CBRE Global Chief Economist.
**1WTC photo courtesy of The Port Authority of New York & New Jersey.
© 2013, CBRE, Inc.
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