In the News
April 02, 2015
Expedia move to Amgen campus underscores need for biotech lab space in Seattle
Puget Sound Business Journal
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Expedia's huge move from Bellevue to Amgen's campus in Seattle's Interbay neighborhood will kill off thousands of square feet of precious lab space from a city already desperate for places to house burgeoning biotech companies.
The online travel company announced today that it is relocating because it's running out of space in its Bellevue offices. Expedia plans to grow from 3,000 to 4,500 employees within the next couple of years.
By the end of 2018, the company will remodel Thousand Oaks, Calif.-based Amgen's offices to remove the biotech's lab space.
Amgen, which sold the campus to Expedia for $229 million, is expected to be able to repurpose some of the existing lab equipment.
The loss of scientific lab space in that remodeling is a disadvantage to the biotech companies, such as fast-growing Juno Therapeutics, that are looking for new offices.
"The demand for lab space had been very lethargic for a number of years, but it's coming back some now," said Bill Neil, senior vice president and partner at commercial real estate firm Kidder Mathews.
With a biotech boom in the Puget Sound region, more and more companies within the industry are growing and going public. Juno Therapeutics, Seattle's rising biotech star, is on the hunt right now for a new headquarters within the city.
Adaptive Biotechnologies and NanoString are both examples of growing biotech companies. NanoString just leased more office space at 500 Fairview Ave. N.
Currently Juno operates in a South Lake Union building at 307 Westlake Ave. N., where the company occupies 23,200 square feet of office and lab space. The company, which spun out of Fred Hutch, is growing fast and needs lab and office space soon.
But there's a catch-22.
Landlords aren't ramping up construction of new buildings with lab space - which are pricey to build - until they know what companies might fill them. And companies that are growing quickly now have nowhere to go.
"We have some clients that need it today. Until there's more construction, it's just not going to happen," Neil said. "These developments are very expensive and landlords are not building speculatively anymore."
Chris Rivera, president and CEO of the Washington Biotechnology and Biomedical Association, said that can make it hard for a company to plan its future.
"How do we balance the need for more lab space with the need for more employees with the need of companies to meet investor demands?" he said.
The lack of space is also a challenge for an industry that is trying to ramp up its recruiting from other national biotech hubs like the San Francisco Bay Area, Boston and San Diego.
"I think most of the biotech community is disappointed that it most likely won't be kept as lab space," Rivera said.
Expedia will make a significant investment in remodeling the space into a "modern design befitting a global technology company," Expedia CFO Mark Okerstrom said.
Amgen will stay at the property until the end of 2015 and Expedia will take possession of it in 2016. Expedia will also construct about 200,000 square feet of additional office space on the property by the end of 2018.
For the full story, go to Portland Business Journal.
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