DivcoWest snags former Johnson & Johnson facility in South San Francisco
By Sarah Klearman
Staff Reporter, San Francisco Business Times
January 13, 2022
Call it a sign of the times: A South San Francisco building that formerly housed several departments of Johnson & Johnson employees is to be converted into Class A laboratory space.
San Francisco-based investor DivcoWest acquired Johnson & Johnson’s 143,383-square-foot office and R&D building Jan. 7 for $164.5 million, or about $1,147 per square foot, the company said in a statement. It intends to begin work to convert the property for laboratory use immediately.
The Business Times reported in March of last year that Johnson & Johnson (NYSE:JNJ) planned to close the facility is located at 5000 Shoreline Court in South San Francisco. J&J acquired the building in 2017 as part of the acquisition of Actelion.
DivcoWest will provide the building with a new generator system, laboratory-grade HVAC system, utility upgrades and common area updates, the company said in its statement. It will begin work on the property without a tenant in hand but expects the building could be ready for occupancy as early as the first quarter of next year. She did not provide any information on the cost of the planned renovation work.
The purchase marks DivcoWest’s second life sciences acquisition in recent weeks: The company acquired a 99,000-square-foot, single-story research building at 6550 Dumbarton Circle in Fremont in mid-December 2021, the company confirmed. Real estate records show that DivcoWest paid $72 million for the property.
The company’s website shows that it already owns a number of life science properties in the Cambridge, Massachusetts submarket, another biotech hub in the country. DivcoWest is actively expanding its life sciences portfolio in the Bay Area, the company said in its statement.
The region’s life sciences market has seen a burst of activity — and rising rents — in recent years. According to Kidder Mathews, the vacancy rate for life science space in San Mateo County was 2.6% in the third quarter.
Last week, DivcoWest added a new tenant to an existing Bay Area holding: Procept, a biorobotics company, signed a lease for 158,200 square feet at 150 and 180 Baytech Drives in San Jose. The Company plans to move its headquarters from Redwood City to the property that DivcoWest owns through a subsidiary also affiliated with Liberty Mutual Group. Our colleagues from the Silicon Valley Business Journal have the story.
Located at 5000 Shoreline, west of US 101 near Sierra Point in South San Francisco, the building is near a number of other properties leased by a number of other life science tenants.
