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EMERYVILLE, CA-The 65,000-sf top floor of Wareham Development’s 245,000-sf EmeryStation East laboratory office building will be home to the Joint BioEnergy Institute, a new $125 million U.S. Department of Energy research partnership. The JBEI signed a five-year renewable lease; it is expected to begin occupying the space in March as tenant improvements are completed and be fully moved in by May.

The Joint BioEnergy Institute is a partnership is led by Lawrence Berkeley National Laboratory, which conducts unclassified scientific research for DOE and is managed by the University of California. JBEI’s mission is to speed the development of renewable biofuels – liquid fuels derived from the solar energy stored in plant biomass. Other partners include the DOE’s Sandia and Lawrence Livermore national laboratories, the UC Berkeley and Davis campuses, and the Carnegie Institution.

“This type of alternative energy use didn’t exist a year or 18 months ago,” listing broker Bill Nork of Cornish & Carey tells GlobeSt.com. “This is new capital flowing into a new area of research.”

The lease includes options to renew for two additional five-year terms. The negotiated lease rate was not revealed by the parties involved; the triple-net asking rate for the space was $3.50 per sf, including a $100-per-sf tenant improvement allowance. Breck Lutz in C&C’s Walnut Creek office represented JBEI

The JBEI drops vacancy in the four-month-old, four-story EmeryStation East building to 30%. The availability includes a 30,000-sf space on the third floor, a 20,000-sf space on the second floor and 20,000 sf of speculatively finished incubator lab spaces ranging in size from 2,500 sf to 7,000 sf. Nork is leasing the space with C&C EVP Randy Scott and senior sales associate Jonathan Tomasco. With leases in hand for about half the remaining availability, the trio is confident the building will be all but fully leased by the end of the year.

Located at 5885 Hollis St., the glass-clad EmeryStation East building has 64,000-sf floor plates and a 20,000-sf garden with fountains and sculptures. Amenities include anti-vibration technology for the sensitive calibration needs in medical research, co-generation power systems for certainty of power supplies and the latest in security systems.

JBEI is the third tenant to lease space in EmeryStation East. The larger of the two tenants previously signed is Amyris Biotechnologies, which is expanding from 15,000 sf in EmeryStation North to 70,000 sf in EmeryStation East. The lease is characterized as “long term,” which means it is likely for at least 10 years in length.

Amyris is currently focused on two things: The production of the drug artemisinin to fight malaria in developing countries, and the production of renewable biofuels. Nork says the company has not yet decided whether it will keep its current space in EmeryStation North.

The other lease was signed by Novartis, which took 35,000 sf in the building, also on a “long-term” basis. Novartis, a publicly traded company involved in pharmaceuticals, vaccines and diagnostics. The lease was signed by Novartis’ Vaccines and Diagnostics subsidiary, which is in the process of selling its manufacturing business and assets relating to the pharmaceutical product, Betaseron, to Bayer Shering Pharma AG.

Earlier this year, Nork attributed the interest in the building to “proximity to the University [of California at Berkeley] and the fact that it is designed for lab users from the ground up.” Jay Keasling, a co-founder of Amysis and JBEI’s Chief Executive Officer, affirmed the statement. “For the JBEI partnership, EmeryStation East was the best fit programmatically and locationwise,” Keasling said.

Wareham paid about $10 million for the development site and constructed the facility on a speculative basis at a cost of approximately $400 per sf. Wareham principal Chris Barlow told GlobeSt.com last year as construction began that the reason for the $100-million development risk is simple: “We have about 1.2 million sf of life science space in the Bay Area and we have zero vacancy. The last two or three years, we have been able to accommodate growth by existing clients and service new ones. Now, without the new building, the problem we would have faced next was not being able to meet the next big requirement.”

Wareham’s existing clients include government agencies, such as the state department of Justice and Substance Control and the federal Environmental Protection Agency, and multinationals such as Novartis and Bayer. “This is a relationship business and you really need to have space on hand in order to let existing tenants grow and respond quickly to new ones,” Barlow says.

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