Biogen will open a West Coast hub in South San Francisco after acquiring a Peninsula drugmaker.
The Massachusetts-based biotech firm plans to set up shop in an undisclosed office in South San Francisco after its $1.5 billion buyout last year of locally based Human Immunology Biosciences, or HI-Bio, the San Francisco Business Times reported.
A beachhead by the Cambridge company began with its merger last year with HI-Bio, which had a 9,000-square-foot office and research lab at 6000 Shoreline Court, on the Oyster Point Boulevard/East Grand Avenue side of town.
Since the acquisition, the HI-Bio unit has doubled its employees to 100 employees, from 50, and plans to nearly triple its offices and labs to 24,500 square feet, according to Jane Grogan, head of research for Biogen.
Its digs on Shoreline have grown by 60 percent since HI-Bio signed its original lease. The three-story, 139,000-square-foot building is owned by Healthpeak Properties, based in Denver.
“That’s where the company is building toward and that footprint here in immunology will be strong,” Grogan told the Business Times.
The decision by Biogen to set up a West Coast shop is good news for the Bay Area biotech real estate market, in a four-year slump after a pullback by investors in life sciences.
A life sciences building boom across the Bay Area during the pandemic added millions of square feet of offices and labs. Then Wall Street investors balked, and biotech firms shelved drug development, laid off workers and shed real estate.
The vacancy rate for life sciences offices and labs in the Bay Area last quarter was 28 percent, up from 27.9 percent late last year, according to a first-quarter report from Newmark.
At the same time, the local life sciences market had two consecutive quarters of positive net absorption, or net change between occupied and vacated space. Companies inked 18 leases last quarter, up from 15 in the prior period and seven a year earlier.
Venture capital funding in the quarter ending in March hit $3 billion for the first time since the second quarter of 2022.
The average asking rate for space was $73.44 per square foot, according to Newmark, off a peak of near $84 in first-quarter 2023, largely because of the amount of offices and labs companies put up for sublease.
— Dana Bartholomew
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