JLL Income Property Trust Acquires NJ Life Sciences Asset
The 147,000-square-foot life sciences building is currently long-term net-leased to the clinical-stage biotechnology company, Celularity Inc.
FLORHAM PARK, NJ – JLL Income Property Trust has acquired a 147,000-square-foot, purpose-built life sciences building in Florham Park, NJ. The property was purchased for $47 million.
The asset, located at 170 Park Ave., is net-leased as laboratory space and the corporate headquarters for the clinical-stage biotechnology company, Celularity Inc. The 15-year lease term provides for an average 2.5% annual rent increases.
“Within the office sector our priority investments are healthcare oriented, focusing on medical office and life science properties,” states Allan Swaringen, president and CEO of JLL Income Property Trust. “In a post-COVID environment of eroding fundamentals for traditional multi-tenant office properties, these two healthcare-oriented sectors stand out for their lower vacancy rates, healthy net absorption and balanced new supply due to significant barriers to entry because of higher construction and tenant improvement costs. These factors also lead to higher tenant retention even during periods of weakness within traditional office market environments.”
Swaringen adds, “While we are excited about expanding our healthcare allocation, we were also attracted to acquiring 170 Park Avenue significantly below replacement cost and with tenant and prior owner-funded improvements to the building in excess of $80 million. Celularity’s improvements resulted in 170 Park housing some of the most advanced laboratory and manufacturing space for cellular medicine and biomaterials in the country.”
Located on more than 18 acres of land within the 270-acre master-planned, mixed-use office park, the Green at Florham Park, 170 Park Ave. represents JLL Income Property Trust’s second healthcare property acquisition within the area. The REIT previously purchased a 100,000-square-foot medical office building at 140 Park Ave. in 2016, which is leased on a long-term basic to Summit Medical Group.
Through the purchase, the firm aims to capitalize on the biopharmaceutical and drug development hub within New Jersey. The state’s life science market totals more than 17 million square feet of research, development and lab space.
The recent acquisition increases the REIT’s healthcare allocation to five properties, comprising more than 450,000 square feet, valued at more than $215 million and representing 7% of its overall portfolio.
The institutionally managed REIT has more than $3.5 billion in portfolio assets and 85 properties.