As part of our high-conviction investment strategy to build a leading global life science business, in April 2021 we acquired Boren Lofts, a 136,000 square foot shell-condition office building in downtown Seattle with a view to speculatively convert it into a life science asset.
Just over a year later it was launched as Boren Labs, a fully operational life science building with the right highly technical real estate infrastructure centre to become home to multiple biology firms researching and developing life changing therapeutics. The project has been a success with only two of its nine leasable floors still available.
How did Oxford make this happen? The team behind the Boren Labs shared their thoughts on what made it a success.
Boren Labs: Exterior + Interior
Q: What attracted Oxford to invest in the Seattle life sciences market in the first place?
Tycho Suter: Seattle had long been on our radar. It has a number of the criteria that we look for in a life science market; a highly educated talent pool, a number of leading universities and research intuitions like the Fred Hutchinson Cancer Research Center and the renowned University of Washington, and increasing levels of governmental and VC funding that creates the right cluster effect. This was then supported by both traditional research and insights gained through Oxford’s artificial intelligence capabilities.
Q: How did AI help this project?
TS: Our AI or Project Warpspeed uses machine learning to create a hunting algorithm that merges dozens of unique data points to identify undervalued acquisition targets and development prospects. Without giving away the secret sauce, it provided useful granular insights that helped validate our initial conviction in Seattle.
Q. How did you get the conviction that your business plan to acquire then convert Boren Lofts to Boren Labs would work?
TS: Our life sciences deals are a very collaborative process. There’s many of us at the table from across investment, development and leasing teams that are discussing the opportunity, leveraging real world examples and learnings from past projects—it’s not just one person in front of a computer running a spreadsheet. We test those assumptions with real world, on the ground experience and expertise.
Matthew Haverty: We really do look at projects holistically and bring expertise from across our business. There are no egos in our group, and we make sure we have the right people in the room to allow for a truly collaborative decision-making process.
Q: What about Boren Labs made it well suited for a life science conversion?
Abby Mondani: The building was originally developed with large tech users in mind. To accommodate all users, this meant important building infrastructure was already included in the original build which meets the needs of life sciences users. Tech users prefer open, airy spaces, so Boren featured upgraded mechanical systems, 15,000 sq ft floorplates, and crucially, its 15’ floor to floor heights are the right size for Life Science users.
Seattle’s life science market is uniquely characterized by early stage ventures who need access to smaller operational spaces as quickly as possible following fundraising. The existing 15,000 sq ft floorplates at Boren Labs are ideal for these companies. They are ready to expand out of an incubator, but not ready to occupy a typical 25,000-30,000 sq ft floorplate. Plus, Boren Lab’s location in South Lake Union, the nucleus of the city’s biotechnology industry, is really where firms and talent want to be.
MH: Exactly. From a construction perspective, of all the buildings we looked at, Boren checked the most boxes out of the gate. One of the first criteria we look at is floor to floor height. Unlike typical office spaces, labs require 100% fresh air circulation. This necessitates a significant amount of ductwork above the finished ceiling. While 12-13’ floor to floor heights are feasible, and Oxford has completed projects with heights lower than this in the past, it adds challenges or trade-offs. The fact that Boren Labs has 15’ heights gave it a significant advantage over other conversion opportunities we looked at in Seattle.
We assess hundreds of conversion opportunities every single year, and this one was top tier in terms of how well it was set up for conversion.
Inside Boren Labs
Q: Oxford also built spec lab suites in this project, why?
AM: Spec lab suites provide our target customer with an ideal solution, ready to occupy space at the right time, with no additional investment needed. With early stage companies, they often cannot afford to spend their valuable time or capital on construction. So, we applied the spec build model we’d successfully completed in Boston to this project in Seattle—which no one else had done in this market. We received significant interest upon announcing our spec build—which we were able to quickly convert into leases.
MH: It was absolutely the right decision; it gives our customers a speed to market advantage where they can just plug in and play. We also chose to provide centralized systems to our customers, such as central vacuums, compressed air, CO2, and pH neutralization. This ensures that our customers don’t have to spend time or money building this infrastructure.
Q: What’s your biggest takeaway from the project?
MH: There’s always trepidation in applying a new model in a new market, but when you have conviction, a smart, focused team, and work together you tend to succeed. We didn’t simply replicate Boston, there was a lot of care taken to cater our offering to Seattle.
TS: Agreed. Our conviction was based on our team and the depth of our capabilities. That allowed us to go strong on building spec labs, which was new for Seattle, ultimately enabling us to be very successful.
AM: I’d add the extent to which our knowledge from other markets has differentiated us has been a takeaway. Sometimes in real estate, companies will simply conform to whatever the ‘standard’ build out might be in a market. We’ve never wanted to be that company.
At Boren Labs we leaned on our expertise to really understand the market challenge, created a unique solution, and executed. And we could not have done that without the belief that comes from previous wins.