Pharmaceutical companies have captured the interest of many developers and with good reason. Softening demand for traditional office space has planners looking for alternative uses to fill out business parks and multiuse developments, and drug makers represent a promising source of highly valuable occupancy.
Speculative construction that accelerated during the pandemic has given pharmaceutical manufacturers plenty of options and enabled them to be choosy in site selection. However, to compete for end users, developers must ensure their properties offer the features and amenities drug makers seek, says Matt Mrva, northeast director of planning and landscape architecture at Bohler, a land development consulting and site design firm.
“Simply adding a life sciences label on conventional flex space is unlikely to lure pharma companies. Research, lab and pharmaceutical manufacturing facilities often require specialized infrastructure and site layouts,” Mrva says. “Even if a property is zoned to allow for life sciences, design and development teams need to understand the proposed operations in order to optimize the facility.”
Unique Facility Requirements
Depending on anticipated needs, tenants may require advanced climate control and ventilation, redundant electrical feeds, high-volume water and sewer service, on-site wastewater pretreatment, backup power generation, reinforced floors to handle the weight of manufacturing equipment and overall structural quality that minimizes noise and vibration, which can disrupt delicate scientific processes. Many companies require multiple loading docks to separate incoming and outgoing materials, as well as maintaining clean zones to prevent contamination of sensitive operations.
For these and other reasons, converting existing office, retail or industrial properties for pharma production is possible but can be challenging, Mrva says. New construction is often easier and faster, particularly if the anticipated uses will require moving utilities, reconfiguring structures or changing internal traffic flow.
“Flexible properties can accelerate leasing, but each business coming into a life sciences park may require additional changes to carry out their operations there,” Mrva says. “Because of that, life sciences developers need to design the site with not only versatility in mind but also options to cost-effectively upfit the space if the original tenant changes its processes or the space transitions to a new occupant.”
Community Engagement
Mrva recommends working with local government during early planning to chart a project’s path to acquire rezoning or other approvals and to begin building goodwill for the development within the community.
That was a critical part of Bohler’s role in The Reactory, a biomanufacturing campus under development in Worcester, Massachusetts. A former state hospital site acquired and repositioned by Bohler’s client, the Worcester Business Development Corp. (WBDC), the project is expected to bring as much as 470,000 square feet of manufacturing space to the 46-acre site near the University of Massachusetts Chan Medical School.
“Our client had the vision to turn this into something that would benefit Worcester and all of Central Massachusetts,” Mrva says. “Bohler was on board as soon as the WBDC had closed on the property, to assist in getting the proposed redevelopment entitled. We helped with early master plan concepts and took those through both state and local permitting processes, then continued to shepherd the project until it was ready to attract tenants.”
The project became a team effort aided by the governor’s office and other stakeholders. The community generally favored the redevelopment, but had to be won over on key points, Mrva recalls. For example, earlier attempts at redeveloping the site tried to preserve and reuse historic administrative buildings from the former state hospital use.
“As it turns out, those kinds of structures were a barrier to redevelopment because they were too small, the corridors were the wrong widths for modern use, and they just weren’t set up to function as modern real estate,” he says. “Rehabilitation was not really an option, so our team helped to make the case for demolition and new construction early in our local and state permitting timeline.”
Today the project has landed two anchor companies, including WuXi Biologics and Galaxy Life Sciences. Galaxy is now developing the remaining lots.
Pharmaceutical Compounds
While laboratory and biomanufacturing developments may be specialized, the sector’s occupiers share challenges common to many employers in large business parks and corporate campuses. Developments that provide dining options and convenient access to outdoor activities, meeting spaces, hotels or other amenities can boost on-site worker satisfaction, potentially giving their tenants an edge on employee recruitment and retention. This makes amenities an important differentiator for property sales and leasing.
A good example is Spring House Innovation Park, a 133-acre life sciences campus under development by a joint venture of MRA Group and Beacon Capital Partners in Lower Gwynedd, Pennsylvania. Bohler provided master planning, site civil engineering design and permitting assistance for much of the campus, which was originally planned as office, but is now under redevelopment to offer more than 600,000 square feet of lab, office, manufacturing and amenity spaces.
“We identified an area where our client could add amenities like a restaurant, a trail network and some outdoor gathering areas that help make this a destination life sciences campus,” Mrva says. “That design has benefited the owner tremendously, making the property stand out to tenants and increasing the overall value of the campus.”
Bohler took a similar approach in creating an outdoor amenity for the Bristol Myers Squibb campus in Devens, Massachusetts. In an area previously undeveloped due to significant grading challenges, the area now draws visitors with a network of lighted pathways with seating throughout and an open gathering area for outdoor events. The company’s decision to transform the acreage into a park underscores the importance of providing amenities along with commercial space.
“They could have built a new manufacturing arm or more office space there,” Mrva says, “but Bristol Myers Squibb intentionally left this central campus area for amenities.”
In the competitive landscape of pharmaceutical manufacturing site selection, understanding facility requirements and catering to life science needs are vital steps in attracting valuable occupancies. By recognizing the need for specialized infrastructure, flexible design and community and employee involvement, developers can create thriving sites that meet the ever-evolving demands of the pharmaceutical industry.
— By Matt Hudgins. Bohler is a content partner of REBusinessOnline. For more articles from and news about Bohler, click here.