Life Sciences Will Continue to Be Growth Market: JLL

MOUNT PLEASANT, NY—The life sciences sector, which has only emerged about five years ago as a growth sector in Westchester County, NY, will continue to be one of the few areas of growth in the county in coming years, according to brokerage firm JLL.

In a “Life Sciences Outlook” report for the New Jersey, New York City and Westchester County markets, JLL says that the life sciences sector in Westchester began to emerge five years ago when Regeneron Pharmaceuticals, Inc. and OSI Pharmaceuticals Inc. made major occupancy and investment commitments. Regeneron expanded its presence in Westchester County by taking an additional 220,000 square feet at BioMed Realty Trust's The Landmark at Eastview in Mount Pleasant. OSI, at the time based in Melville, NY, purchased the 43-acre Ardsley Park Science and Technology Center with plans to reposition the site as its headquarters campus. Regeneron has since expanded, while OSI never took occupancy of its space after merging with Astellas Pharma Inc. of Japan.

In 2011, BioMed Realty Trust bought the Ardsley Park site from OSI. Acorda Therapeutics Inc. relocated and consolidated its operations there from within the county in 2012 and recently announced it was expanding there by another 25,000 square feet. Regeneron has also expanded at The Landmark at Eastview and currently has a 300,000-square-foot building there under construction.

“Westchester County's life sciences sector benefits from a disproportionate amount of public and private investment,” says Chris O'Callaghan, managing director and Westchester County market lead for JLL. “There are few other investment targets that offer as much long-term positive impact.”

The county's laboratory- and life sciences-suitable stock totaled slightly more than 3 million square feet of space at year-end 2013. The overall vacancy rate was 14.6%, down slightly from one year earlier, and substantially lower than the 20.2% overall vacancy rate posted by Westchester County's office market. Overall average rental rates for life sciences space were on the rise, increasing 1.8% the past year to $18.50 per square foot on a triple net basis, JLL reports.

Additional life sciences-related inventory could be on the horizon if Westchester County's North 60 project at the Grasslands campus in Valhalla progresses. The North 60 project will encompass 60 acres of biotech development that includes New York Medical College's $12.6-million biotechnology incubator and Fareri Associates' $500-million, 2 million-square-foot biotech and medical park.

Westchester County officials recently conducted a study of transit-oriented development that proposed life sciences-based developments in Southern Westchester. The projects would include 1.4 million square feet of research and development space, while repositioning more than 1 million square feet of functionally obsolete office space.