Harrison Street, Partners Sell Trio of Life Sciences Properties in Metro Boston to Healthpeak for $720M
CAMBRIDGE, MASS. — Harrison Street and its investment partners The Bulfinch Cos. and National Real Estate Advisors have sold three life sciences buildings at Cambridge Discovery Park for a gross sale price of $720 million. Denver-based REIT Healthpeak Properties Inc. (NYSE: PEAK) purchased the properties, which are situated in Boston’s West Cambridge submarket.
For Bulfinch, the master developer of Cambridge Discovery Park, the transaction with Healthpeak was a recapitalization of its stake in the development. The Boston-based firm entered into a joint venture transaction with Healthpeak whereby Bulfinch will retain a majority ownership stake in one of the buildings. Additionally, Bulfinch will continue to manage the property.
The Cambridge Discovery Park acquisition, which also includes two parking garages, totals approximately 620,000 square feet. The buildings, called 100 CDP, 200 CDP and 400/500 CDP, were 94 percent leased at the time of sale to biotechnology, pharmaceutical and research companies with a weighted average remaining lease term of approximately 7.5 years.
According to Healthpeak, the acquisition also includes an approximately 100,000-square-foot site for a future densification opportunity that the REIT plans to co-develop with Bulfinch. Cambridge Discovery Park includes six life sciences buildings and an AC Hotel by Marriott. The campus is situated three miles northwest of Harvard University and seven miles northwest of MIT.
Chicago-based Harrison Street partnered with Bulfinch and National Real Estate Advisors with the development of 400/500 CDP in December 2018. Harrison Street acquired ownership interests in both 100 CDP and 200 CDP in the spring and summer of 2019, respectively.
“We executed on our business plan for the portfolio, including stabilizing the properties — nearly three years ahead of schedule — and attracting best-in-class bioscience tenants,” says Ben Mohns, senior managing director and head of asset management in North America at Harrison Street. “Supporting the life sciences sector by providing world-class facilities has never been more important, and Harrison Street is committed to identifying attractive investment opportunities in key life sciences markets.”
Harrison Street’s current life science portfolio totals more than $2 billion across 3 million square feet of lab, research and innovation space globally. Overall, the firm has more than 185 employees in its Chicago and London offices and has approximately $29 billion in assets under management.
Bulfinch is an investment firm specializing in the development, acquisition, management and repositioning of commercial real estate properties in Greater Boston. The privately held company currently has $3 billion in real estate assets under management.
Healthpeak owns and develops properties in the three private-pay healthcare asset classes of life science, seniors housing and medical office.
In September, Healthpeak and joint venture partner King Street Properties broke ground on a $174 million life science development near Cambridge Discovery Park in West Cambridge. Totaling approximately 159,000 square feet, the five-story laboratory building is expected to come on line in third-quarter 2022.
The Cambridge Discovery Park acquisition brings the REIT’s Boston footprint to 2.4 million square feet. The company’s stock price closed on Monday, Dec. 7 at $30.69 per share, down from $34.19 a year ago.
— John Nelson