71st Annual Review & Forecast
A SECRET PHARMA DEAL, MONTHS IN THE MAKING
Late in 2016, Irish pharmaceutical firm Shire plc revealed plans
to establish a rare disease innovation campus in the heart of
Kendall Square in Cambridge, MA, in space that was never officially on the market. The location? The former Genzyme headquarters at 500 Kendall St.
Genzyme, a subsidiary of pharmaceutical firm Sanofi, has occupied the BioMed Realty-owned building for the past 12 years, but
will relocate to some 251,000 sf at 50 Binney St. once that property
is completed next year. Shire, meanwhile, occupies approximately
206,000 sf at BioMed Realty’s adjacent 650 E. Kendall St. The firm
will retain its current office, lab and manufacturing space in
Massachusetts, including its US headquarters in Lexington.
The deal was several months in the making and required
complete secrecy. The Kendall Square market was extremely
tight in mid-2016, with little space likely to become available
over the next 24 months. Shire, interested in expanding its
presence in the area and guessing that Genzyme may not exercise its lease renewal option when it came up in November,
engaged BioMed Realty, The owner intended to wait until the
space was unencumbered and before formally marketing the
building but, given its relationship with Shire, entered into
confidential discussions and struck an agreement.
Shire’s lease for the 343,000-sf space will begin in the third
quarter of 2018, with occupancy anticipated in the first quarter
of 2019. Shire says the firm plans to hire an additional 400
workers in Massachusetts. A Transwestern team of
Steve Pupura, Eric Smith, Robert Richards and Brian
Cohen brokered the agreement between BioMed
Realty and Shire.
LAB ASSETS ADD VALUE TO MXD CAMPUS
Another deal down the road took the prize as Boston’s
biggest office sale, and the second-most valuable office
trade outside of New York last year. Alexandria Real
Estate Equities shelled out $725 million, or $1,124 per sf,
to buy One Kendall Square from Divco West Properties.
The nearly 700,000-sf office and laboratory campus
sits on 7.88 acres in the East Cambridge/Kendall
Square submarket. The 11-property asset includes a
movie theater, parking garage and fully permitted
development site in addition to retail, lab and office
space currently 99% leased to tenants including
REAL ESTATE FORUM Presents...
500 Kendall St.
Deals l Dealmakers l Places l Placemakers