Life Sciences Outlook. Westchester County 2016

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Henry Singleton
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1 Life Sciences Outlook Westchester County 2016

Westchester County Just a short distance from Manhattan, Westchester County is an ideal location to many firms looking to attract and retain talent.

2 Westchester County Just a short distance from Manhattan, Westchester County is an ideal location to many firms looking to attract and retain talent. The access to transportation is plentiful, especially in White Plains and along the 287 corridor. Life sciences was one of the only growth sectors in the area during the recession and its subsequent recovery. Regeneron drove the majority of this activity with a massive expansion at 777 Old Saw Mill River Rd. Major lab supply: Clusters of established lab stock with long-time industry presence Emerging lab supply: Areas with limited lab stock today that are poised for growth Life Sciences manufacturing supply: Clusters of manufacturing space devoted to pharmaceutical, biological or medical device & instrument manufacturing Westchester Overview With its proximity to major research institutions and to New York City, Westchester County has been a home to the life sciences sector for nearly 13 years, employing approximately 10,000 biomedical professionals. For the past decade, companies such as Regeneron and Acorda have headlined the life sciences activity in the area. Regeneron is currently expanding at its Old Saw Mill River Rd. complex by another 300,000 square feet. There are also 500,000 square feet of future redevelopment and development potential that could accommodate multiple tenants at Ardsley Park, where Acorda calls home. With few large life sciences-suitable blocks on the market, this will be a highly sought after space. Some of the larger projects that are coming soon to Westchester include the North 60 and a recent transit-oriented development study for a portion of Southern Westchester. The planned North 60, which will be located at the Grassland s Reservation, will encompass 60 acres of biotech and medical space. This will include New York Medical College s $12.6 million biotechnology incubator and Fareri Associates $500 million, 2 million-square-foot biotech and medical park. The transit-oriented development study proposed for Southern Westchester developments 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. JLL Westchester County Life Sciences Outlook

3 2015 Economic scorecard Cluster score: 41.2 WORKFORCE Total life sciences % life sciences to private Year-overyear growth employment Employment 7, % 3.9% Establishments % 0.0% FUNDING Total life sciences % to total U.S. VC funding $167.4M 2.44% NIH funding $23.4M 0.20% The life sciences market has seen explosive growth in the last year in terms of employment. The companies that have found a home in Westchester are expanding their operations in many cases; Regeneron alone has created an additional 1,200 jobs. SUPPLY Total lab supply (s.f.) % direct vacancy 2,660, % This market is dominated by lab tenants, which account for nearly 75 percent of all employment in the life sciences industry. The overall employment numbers experienced growth for the third consecutive year. Life sciences employment composition 53.3% 0.8% 7.1% Life sciences employment 7, % 32.9% non-lab using lab using Pharma & Medicine MFG Electromedical Instrument MFG Medical Equipment & Supplies MFG Testing Laboratories R&D Medical & Diagnostic Laboratories Life sciences establishment composition 21.6% Life sciences establishments % 2.8% 11.1% 7.2% 9.3% Pharma & Medicine MFG Electromedical Instrument MFG Medical Equipment & Supplies MFG Testing Laboratories R&D Medical & Diagnostic Laboratories The local life sciences industry is transitioning from larger pharmaceutical players to one where demand is driven by mid-sized pharmaceutical, biotechnology and generic drug companies. Growing biotech companies have tapped the pool of skilled employees that were downsized following mergers among the larger companies. JLL Westchester County Life Sciences Outlook

4 Westchester County I-287 West Corridor 89.7 percent of lab space in the I-287 West Corridor is occupied Companies occupying more than 400,000 square feet will look for build-to-suit in upcoming months. Regeneron has the biggest life sciences footprint in Westchester County. They currently occupy approximately 700,000 square feet and are in the process of building an additional 300,000 square feet at 777 Old Saw Mill River Rd. in Tarrytown. Vacancy in this area is around 11 percent due to a significant number of long-term leases. There has not been much turnover as a result of this. Life science companies consider Westchester County and the Hudson Valley an important cluster to meet space requirements in this sector. Facilities scorecard SUPPLY Rentable lab stock (% of cluster stock) Direct vacancy (Change year-over-year) I-287 West major lab 2.0M s.f. 39.6% 11.0% Westchester South major lab 0.66M s.f. 17.5% 15.2% # of large blocks over 50,000 s.f. 0 2 Under construction (s.f.) 300,000 s.f. 0 s.f. DEMAND # of requirements Total s.f. requirements PRICING Average asking rent (NNN) (Change year-over-year) 0 0 s.f. $52.00 p.s.f. 0 0 s.f. $45.00 p.s.f. Westchester South Limited activity slows down industry growth, but build-to-suits available Start-Up NY was created in an attempt to try and attract large companies to New York by giving them 10, tax-free years of operation on or near eligible university or college campuses. To date, it has yielded few results, but continues to be on the radar screen of life sciences and technology companies circling the Westchester market. Acorda remains the largest tenant in the market. 500,000 square feet of potential space can be built in Ardsley Park. Lab space vacancy in this submarket has remained flat as a result of limited recent activity. REGENERON 777-A Old Saw Mill River Rd. The Landmark at Eastview 28,837 square feet 767 OLD SAW MILL RIVER RD. The Landmark at Eastview 78,414 square feet 777 OLD SAW MILL RIVER RD. The Landmark at Eastview B 157,500 square feet BioMed Realty Expected delivery: months 777 OLD SAW MILL RIVER RD. The Landmark at Eastview C 139,500 square feet BioMed Realty Activity key: Leasing Sales Under construction Large blocks of space JLL Westchester County Life Sciences Outlook

5 For more information, please contact: Dayna McConnell Research Analyst Stamford, CT +1 (203) About JLL JLL (NYSE: JLL) is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. A Fortune 500 company with annual fee revenue of $5.2 billion and gross revenue of $6.0 billion, JLL has more than 280 corporate offices, operates in more than 80 countries and has a global workforce of more than 60,000. On behalf of its clients, the firm provides management and real estate outsourcing services for a property portfolio of 4.0 billion square feet, or 372 million square meters, and completed $138 billion in sales, acquisitions and finance transactions in Its investment management business, LaSalle Investment Management, has $58.3 billion of real estate assets under management. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit About JLL Research JLL s research team delivers intelligence, analysis and insight through market-leading reports and services that illuminate today s commercial real estate dynamics and identify tomorrow s challenges and opportunities. Our more than 400 global research professionals track and analyze economic and property trends and forecast future conditions in over 60 countries, producing unrivalled local and global perspectives. Our research and expertise, fueled by real-time information and innovative thinking around the world, creates a competitive advantage for our clients and drives successful strategies and optimal real estate decisions. This publication is the sole property of Jones Lang LaSalle IP, Inc. and must not be copied, reproduced or transmitted in any form or by any means, either in whole or in part, without prior written consent of Jones Lang LaSalle IP, Inc. COPYRIGHT JONES LANG LASALLE IP, INC. 2016

Life Sciences Outlook. New York City 2016

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