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Amgen is offering 100,000 square feet for sublease in a market with a 20% vacancy rate.
Available life sciences space continues to expand in the Bay Area as new supply floods the market while major companies downsize or consolidate their locations.
Biotechnology company Amgen is subleasing about 100,000 square feet of space at ChemoCentryx’s former headquarters in San Carlos on the Peninsula.
The space being offered for sublease includes the fifth and sixth floors of 835 Industrial Road, one of two buildings that make up the Alexandria Life Sciences Center, according to the company. San Francisco Business Times.
Amgen assumed the lease for 96,000 square feet in the 278,000-square-foot building when it acquired drug maker ChemoCentryx Inc. for $3.9 billion in 2022. The lease for lab and office space runs through 2030.
In the Bay Area’s life sciences sector, a wave of new supply, including conversions and new developments, is outpacing demand, driving vacancy rates up by more than 20% for the first quarter of 2024.
The Bay Area rental market slowdown continued in the first quarter, with total leasing activity across the region at just 394,000 square feet, 41% below the quarterly average over the past decade.
According to a CBRE market report, life sciences net absorption remained in negative territory, totaling negative 648K sq ft. The overall Bay Area vacancy rate reached 20.4% in the first quarter. Life sciences vacancy in the San Francisco Peninsula submarket was 22.2%, up 460 basis points from the fourth quarter.
Nine new projects totaling nearly 1 million square feet were delivered in the Bay Area in the first quarter. The largest delivery, the 561,000-square-foot Genesis Marina project in Phase 3, was delivered with 60% pre-leased. The largest renovation project, the 52K-square-foot 3600 Bridge Building in Longfellow, was delivered with no lease, the report said.
The Bay Area’s life sciences construction pipeline has been booming with projects that began last year converting vacant offices into lab space. As of the end of the first quarter of 2024, 33 life sciences projects totaling approximately 7.4 million square feet were under construction, including 5.2 million square feet of ground-up development and 2.1 million square feet of building-wide conversions to life sciences.
In March, Pfizer subleased the 91K-square-foot property on the Cove at Oyster Point, the former South San Francisco headquarters of Global Blood Therapeutics, the drug development company it acquired two years ago for $5.4 billion.
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