They're one-off. Focusing on sustainability and philanthropy, Alexandrias corporate responsibility business vertical affirms the companys commitment to making a positive impact on the world. In 1993, the partners at Jacobs Engineering Group asked Marcus, a certified public accountant and biotech industry attorney, to create a business plan to launch a private REIT that would exclusively own and invest in life science real estate, essentially, creating a brand-new asset class. It's Peter. He was also a practicing certified public accountant and tax manager with Arthur Young & Co., where he focused on the financing and taxation of REITs. One of Alexandrias largest efforts is OneFifteen, a data-driven opioid treatment and recovery campus in Dayton, Ohio, created in partnership with Verily, the life science arm of Google-parent company Alphabet. D.C. While the macro environment remains challenging, we are reasonably optimistic that we can execute on our disposition plan in 2023 at attractive values and cap rates. With Fed Decision Looming, Economy and Markets Wait Google Stock Concerned About AI? I don't know that -- I mean, we don't call it a credit watch list. In 1996, Marcus founded the companys venture capital arm, Alexandria Venture Investments, to provide strategic investment capital to innovative life science and technology entities developing breakthrough therapies and technologies. And so, a combination of settling in on activity this quarter, as well as our continued outlook for the remainder of the year, so slight improvement overall. WebMarcus co-founded Alexandria in 1994 as a garage startup with $19 million in Series A capital and, as Chief Executive Officer from March 1997 to April 2018, has led its growth That was almost all of the change in the tenancy from roughly 1,000 to 850. But I think the bottom line is the simple bottom line. And that's kind of the critical message. WebJoel S. Marcus, J.D., CPA Executive Chairman & Founder, Alexandria Real Estate Equities (NYSE: ARE)/Alexandria Venture Investments Read More Rory B. Riggs, MBA Co-Founder and Director, Royalty Pharma; Founder and CEO, Syntax LLC, Locus Analytics; Managing Member, Scientia Ventures. Mr. Marcus also founded and continues to lead Alexandria Venture Investments, the companys strategic venture capital platform. You see that just everywhere and you certainly see it on more of a normalization of our historical leasing, which has bounced around over the last either five-year benchmark or 10-year. Yeah, thanks. With its core focus on real estate, Alexandria has a proven track record of developing Class A buildings on urban life science and technology campuses in AAA innovation cluster locations, including Greater Boston, San Francisco, New York City, San Diego, Seattle, Maryland, and Research Triangle Park. Information is provided 'as-is' and solely for informational purposes, not for trading purposes or advice, and is delayed. So you will see some of that, but they're fairly small in the scheme of this. REITs invest in the majority of real estate property types, including offices, apartment buildings, warehouses, retail centers, medical facilities, data centers, cell towers, infrastructure and hotels. For decades, Alexandria has been a leader in building sustainable campuses. So, we don't necessarily think that those buildings are competitive to ours. Koh was unimpressed with the revisions and tossed the suit. We're fortunate we have one project moving that is kind of a good niche for earlier-stage companies, mid-stage companies, so we don't have to go on an elephant hunt to lease some really large project, but there's a lot of folks out there that are going to be in a lot of trouble because of what I would think is fairly reckless investing. But we also agreed to credit our partner $5.5 million in fees payable, because we sold 33% of the total 37% our partner purchased those fees equate to approximately $15 million in value. However, the mega-mergers in the agricultural field that have occurred over the past two years have made it clear that the only way to disrupt the entire farm-to-table system is by spawning a whole new system of startups in the agtech area. I think, as I mentioned on the call earlier, we're mindful of the macro environment. For example, Alexandria signed a massive, 462,000-square-foot lease with vaccine-maker Moderna at its Alexandria Center at One Kendall Square mega campus in Cambridge, Massachusetts. And I think that's probably the best example I could maybe share Peter, but you could give you color. Its goal is to develop and operate efficient and healthy buildings by reducing carbon emissions and mitigating climate risk. The second is STEM education without the next generation of scientists and computer programmers and engineers, were at a loss to imagine where our innovation industries will go. Joel S. Marcus; Founder & Executive Chairman; Alexandria Real Estate Equities, Inc. Peter M. Moglia; CEO & Co-CIO; Alexandria Real Estate Equities, Inc. Alexandrias already-strong performance was amplified by the pandemic when demand surged from new and existing tenants across its portfolio, as billions of dollars flooded into the research and development of a COVID-19 vaccine and other therapies to combat the virus. At quarter end, projects under construction and near-term projects expected to commence construction over the next four quarters totaled 7.6 million square feet and are 74% leased or under negotiation. No, that is helpful. Q1 2023 Alexandria Real Estate Equities Inc Earnings Call Well, it's all reflected in our guidance. Joel S. Marcus, Executive Chairman and Founder of Alexandria Real Estate Equities, Inc./Alexandria Venture Investments, Honored by the 9/11 Memorial & As you know, Alexandria is truly a one-of-a-kind S&P 500 company. While the outlook for Alexandria certainly looks solid, one thing that people are watching is the health and liquidity of the underlying biotech industry, Rodgers notes. Or have you seen kind of any institutional interest that you hadn't seen before? Any number of cities would like to get there but probably dont currently have those characteristics: Chicago, Denver, Phoenix. WebMarcus co-founded Alexandria in 1994 as a garage startup with $19 million in Series A capital and, as Chief Executive Officer from March 1997 to April 2018, has led its growth Sorry, we could not find any results with the search parameter provided. Marcus says it takes roughly 25 years for a cluster to mature. LEADERS Interview with Joel S. Marcus, Executive Chairman The company's revenues are derived in the following markets: Properties are generally located near universities to attract tenants. And I guess just on that line of thought, like our markets like in the non-cluster markets, like RTP, suburban Maryland, are those sort of seeing similar kind of normalization demand trends as San Francisco versus maybe like your core mark submarkets like Cambridge, BTC, Torrey Pines in San Diego. Additionally, he is a member of the MIT Corporation Visiting Committee for the Department of Biology. All stakeholders should recognize and appreciate this management team took a highly disciplined approach over a multi-year period to create a fortress balance sheet to successfully weather what now is the current self-inflected economic storm by the various policies that we implemented over the last many years. We expect that the life science sector will be minimally affected going forward as evidenced by venture financing rounds that closed in March is expected and continue to do so in April, which I'll touch on in more detail shortly. As a testament to this point, with the week remaining in April, private biotech tenant rent collection is at 99.7%. And is there any read-through to other recent acquisitions, Greater Boston like Gatehouse Drive or presidential way? Please go ahead. Alexandria, which celebrated its 20th anniversary as an NYSE listed REIT in May 2017, is the only publicly traded pure-play office/laboratory REIT. Joel S. Marcus Magnolia Neurosciences Corporation Real-time analyst ratings, insider transactions, earnings data, and more. Thank you. And for the most part, Rich, for the most part, those are either 100% leased projects or multi-tenant projects, most of which have some level of pre-leasing. Marcus says toplife science clusters and the upgraded amenities that Alexandrias buildings offer are a significant advantage for companies in their ability to recruit and retain top talent in a very competitive environment. 6.7 million square feet under construction or including 1.2 million to start in the near-term here. Specific to life science buildings, the availability of switchgear and equipment such as HVAC units and generators are -- has slightly improved but their lead times are still extraordinarily long with custom air handlers taking 27 weeks longer to get than before COVID and switch gear and generators and astounding 64 weeks longer. The asset base in North America includes 36.7 million RSF of operating properties and 3.4 million RSF of Class A properties undergoing construction, 7.7 million RSF of near-term and intermediate-term development and redevelopment projects and 10.3 million SF of future development projects. Joe, look, I can appreciate that you still haven't closed a lot of these deals, but I think the market would certainly appreciate just any range of commentary you could provide on how to think about cap rates? The Alexandria Summit convenes a diverse group of visionary partners and key stakeholders from the biopharma, technology, agribusiness, medical, academic, venture and private equity capital, philanthropy, patient advocacy, and government communities to address the most critical challenges in healthcare. Berkley Center for Religion, Peace & World Affairs, 3307 M Street NW, Suite 200 Yeah. If you look at us today, we'd say, well, let's think carefully about site work given cost of capital considerations with the macro environment today, and let's just hold on that until the right time. [9] The company stopped construction during the financial crisis of 2007-08, and in 2014, it sold its interest to the Government of Ontario for $65 million. The result is tenants like Eli Lilly that continue to translate this R&D into transformative medicines. With that, let me turn it back to Joel Marcus. This page highlights square footage of our operating, but most importantly, the different categories of our pipeline, everything from construction to the future. Improving nutrition is a newer goal that were just starting to develop. When you look at the focus on agtech, was this a natural progression for Alexandria? [12], In July 2018, the company acquired 219 East 42nd Street, the headquarters of Pfizer, for $203 million in a leaseback transaction.[13]. The buyer will fund the remaining construction costs to deliver the property to our tenant until they reach a 37% ownership, which is expected to be the remainder of the cost to deliver the project. We just have a more -- much more hands-on work approach with clients. I guess what I'm trying to just make sure if I'm putting a cap rate on ARE's NOI and getting a value, what from that slide do I need to add to that to kind of capture the totality? And so I was wondering -- if I don't know if there's an Alexandria dashboard, so to speak, or what, but can you maybe give us a sense as to what either like leasing traffic, rate or just the aggregate amount of demand that's coming out of your portfolio today looks like versus, say, now two, three, four quarters ago? But as Hallie mentioned, BCs are more discriminate disciplined in demanding of future investments and companies with tenured management teams, strong differentiated technologies and near-term value inflection milestones are the ones that will rise above the fray. Do you see enough demand today to absorb the space that's coming online in the next couple of years? This individual is not a direct affiliate of the Berkley Center. And first of all, I want to send a big thank you to our entire ARE family team for an operationally and financially strong first quarter in a tough -- continuing tough macro environment. South San Francisco, we've never had a dominant position. All rights reserved. The U.S. Department of Agriculture and the related departments spend less than $1 billion on ag research. Executive Chairman and Founder, Joel Marcus WebEditors Note. But that's been filled in by some other new folks coming in that want exposure that are also high-quality institutional investors. But the book value has that $4.2 million in there? WebJoel S Marcus is Chairman/Co-Founder at Alexandria Real Est Equities. Your password must be at least 8 characters long and contain at least 1 number, 1 letter, and 1 special character. Alexandria But if it's stable, high-quality assets going to have a five handle on it just like this one did. Paula Schwartz - Investor Relations. Well, wait a second, the $4.2 million is in rental properties today, it's in operations, Tony. See Joel S Marcus's compensation, career history, education, & memberships. Thanks. For example, Alexandria tenant Gilead has laid out an ambitious plan to achieve 20 new drug approvals by 2030, which will entail advancement of their current pipeline, particularly in oncology, supplemented by additional M&A. They're either completed or subject to executed LOIs or purchase and sales agreements, including the new JV partner for our build-to-suit project for UI Lilly. And while SVB has created a niche serving the segment, it was also cultural. Each of the markets is seeing strong demand. The asset is under construction and will not be delivered until the end of this year with cash flow commencing in mid-2024. Rooted in its mission to advance human health, improve nutrition and enhance the quality of people's lives, Alexandria partners with leading local and national non-profit organizations, medical research institutions and municipalities to make a tangible positive impact in its clusters and communities. And are the investors that we attracted really like the building, and it was an opportunity to fund something that was near-term dollars. So we've, I think, done an extraordinary job of managing rent collections and monitoring all of our tenants in a way that I don't think anyone else could even imagine. Markets never sleep, and neither does Bloomberg News. I'm curious as to what you've committed to in terms of development spending. It's a retail project known as the shops at 10 Fran. 1-800-3-NAREIT So it certainly is one of those opportunities that would attract a variety of capital sources. Okay. Thanks for taking the question. Alexandria boasts more than 1,000 tenants including Moderna, Bristol-Myers Squibb, Sanofi, Illumina, and Takeda. Depending on who you ask, demand is at slightly below or slightly above pre-COVID levels. I mean, I guess the big picture is like everyone kind of sees the headlines on what's going on in life science. Absolutely, that's helpful. Its a perfect time. Tony, it's Dean here. Please go ahead. contact@marketbeat.com We all have a responsibility to ensure that we never forgetthat we continue to pay tribute to those we lost; recognize the heroism, sacrifice and resilience of so many; and share lessons learned with new generations. Theyre a giant in a very small industry, which has been really unique for them, and its been a great attraction for investors, says David Rodgers, Baird & Co. Inc.s senior analyst covering office real estate. Steven Marcus, 41, the eldest of Joel Marcuss three children, started two companies, London-based RUNLABS UK and Dublin-based RUNLABS Ireland, that plan to house life science firms in Europe. The REIT also signed a 334,00-square-foot lease with Eli Lilly and Co. for the development of Lillys new state-of-the-art Institute for Genetic Medicine at 15 Necco Street in the REITs Seaport Innovation District submarket ofGreater Boston. On lease sublease space is at 3.9% and unleased directly competitive with our AAA locations and building quality to be 1.5% to be delivered in 2023 and 5.1% to be delivered in 2024, a 1.3% total increase in availability from last quarter. But as Winston Churchill once said, "Never let a good crisis go to waste." What happens on these campuses is intertwined with our other three verticals. As we all know, the rapid rise in interest rates have not only increased investors' cost of capital, but created a lot of uncertainty causing a number of investors to remain on the sidelines. Joel Marcus, who lives in Beverly Hills, Calif., is executive chairman and co-founder of the Pasadena-based firm. [2], The company is named after Alexandria, Egypt because of that city's connection to science. Thank you for taking my question. The firm has maintained strong financials despite the ongoing economic storm, according to Executive Chairman and Founder Joel Marcus. Most REITs trade on major stock exchanges, and they offer a number of benefits to investors. Please go ahead. I realize not singling out individual deals, but is there a way to bracket them or bucket them against maybe where your implied cap rate is today, or maybe against the deal that Peter discussed? If you want to look at it from that perspective, redevelopments were placed into operations as vacant assets, development projects for the future for -- they have been paused on a few circumstances, which basically were left in the future development pipeline. Transitioning to private venture-backed biotech which makes up 8% of our total ARR, we continue to see a reset of venture deployment to pre-2020, 2021 levels, which while down from peak remains strong by historic standards. And then just last, on 15 Necco, what's the reason for selling that specific, I guess, development stake? WebJoel S. Marcus has served as a member of our Board of Directors since January 2017. As Peter highlighted, we've advanced transactions aggregating $865 million. Maybe I'll start from the back end of your question. WebJacobs approached Joel S. Marcus, a lawyer and CPA, with the idea of representing their interests in this company to oversee the management team who intended to provide We were ahead of that curve because, historically, life science companies did not want to collaborate with institutions and other companies either. [Operator Instructions] The first question today comes from Steve Sakwa with Evercore. Steven Marcuss firms issued a brief statement, saying RUNLABS is pleased to see justice rendered.. For Alexandria to own big concentrations of campuses where they can provide the amenity base, as well as the opportunity to expand and move into different facilities and have them run incredibly professionally by one of the most experienced teams in the industry, is a real competitive advantage for Alexandrias tenants.. Joel S. Marcus is the Executive Chairman and Founder of Alexandria Real Estate Equities, Inc. (NYSE:ARE), an urban office REIT uniquely focused on collaborative life science and technology campuses in AAA innovation cluster locations. Alexandria Real Estate Equities - Wikipedia Mr. Marcus serves on the boards of directors of Applied Therapeutics, Inc. (NASDAQ: APLT), Frequency Therapeutics, Inc. (NASDAQ: FREQ), Intra-Cellular Therapies, Inc. (NASDAQ: ITCI), and MeiraGTx Holdings plc (NASDAQ: MGTX). Joel Marcus Net Worth (2023) | wallmine Pasadena REIT Buys Raytheon Campus Outside Boston - The Thus, the office component cannot be broken out or compared to traditional office, but is an adjacent, highly integrated and critical component of laboratory design and workflows. This is such a natural part of what we do we think of it every day; it is not something we strain to do. The company had one of the worlds first office/lab projects certified in theU.S. Green Building Council LEED Core and Shell pilot program, and now has over 80 projects that achieved or are pursuing LEED certification. I know people who did diligence and they said they could never look at the Edison machine. In fact, across this tenant base, they have raised over $1.9 billion from BC and pharma partnerships since the beginning of the year, of which $800 million has closed following the collapse of SVB. Yeah. And we continue to be the dominant owner as well. [6][1], The company's San Diego properties are primarily in Torrey Pines, San Diego, University City, San Diego, and Sorrento Mesa, San Diego. This is very similar to last quarter, but in response to the uncertainty and volatility in the markets, we have made a strategic decision to reduce 2023 construction spend by $250 million by pausing or delaying projects that had been classified as under construction, so we can focus our capital on the most strategic projects that have the most attractive terms, enabling our highly bedded and vast tenant base. Ismail agrees: Theres some concern with biotech stocks, but overall, thats more of a potential change in the rate of growth rather than something that appears likely to upset or end the party.. I would say that we will see things that are still lower than 5% potentially when there's a good mark-to-market opportunity that can be monetized. [1], In 1993, one of the partners of Jacobs Engineering Group, Jerry M. Sudarsky, was presented with a Business Plan written by Kendell R. Lang titled BioProperties Management Group, Inc., which was a plan to form a REIT dedicated to funding biotech properties. And now 20 years later, in the brutal wake of the end of the country's war in Afghanistan, we again find ourselves immensely indebted to the thousands of service members who have devoted and sacrificed so muchespecially the many who have made the ultimate sacrificefor the sake of their missions and their teams, the defense of our country and the fight against terrorism at its roots, and the safeguarding of our freedoms.". And where could equity play into that? Bipartisan support for life science research remains strong. Well, and also, historically, if you go back to my comments, I said we have tried to shape the Company and allocate our capital as much as possible the high barrier to entry markets and mega campuses. I think we're still seeing decent activity maybe RTP or RT, I should say, has slowed maybe a bit more than we would have guessed, but part of that's due to my guess is the mix of tenants down there in the -- not so much our tenants per se, but the mix of life science, the components of life science tenants in that market. Then we also feel its important to support military families. Joel S. Marcus - Foundation for the National Institutes of It really has transformed in a way that I could never have quite imagined, and thats coincided with the boom in the biotechnology industry.. The overarching larger vertical is real estate the infrastructure and collaborative campuses that we build to support entities like life science and ag companies. From dusk to dawn, Alexandria will light up the facades of the East and West Towers at the Alexandria Center for Life Science NYC in "Memorial Blue" to help illuminate the Manhattan skyline, joining numerous organizations across the city in a tribute to the power of the human spirit displayed in the aftermath. Plus after having been in real estate for about eight years at that point, I could see a tremendous value in offering mission-critical facilities over commodity product. Although the case was dismissed, it was a limited basis, he said. And I mean it's a world-class building with a world-class tenant. We now have two or three mega agriculture companies that literally control the worlds food supply, and that isnt good. As CEO from March 1997 to April Joel S Marcus, Alexandria Real Est Equities: Profile and Our range of guidance for EPS is $2.21 to $2.31 and a range for FFO per share diluted as adjusted is $8.91 to $9.01 with no change at the midpoint of $8.96. We beat guidance and we raised guidance. To that end, therapies such as Mounjaro, save and extend lives and have the potential to significantly drive down the cost of health care more broadly. And I appreciate the color that you guys have provided thus far on sort of demand and the normalization on that front. Its first quarter revenue rose 28.2%, from the year earlier, to $615.1 million. Absolutely. [1], The company's largest tenants are as follows:[1]. So, I think that's one example, yes. The company leased 4.1 million square feet during the fourth quarter alone. We have a very strong balance sheet. With me today are Peter, Dean, Hallie and Dan. It's slower than it has been because obviously, '20 and '21 were peak times and obviously COVID dollars we're heavily focused on that market, but we're still seeing pretty decent activity that I would say, matches our historical numbers. But US District Court Judge Lucy H. Koh, of Californias Northern District, ruled her court has no jurisdiction because Steven Marcuss companies operate strictly in Europe and Steven lives in London. So these inefficiencies will be with us for a while. See what's happening in the market right now with MarketBeat's real-time news feed. Alexandria I saw you revised upward the leasing spread guidance. The next question comes from Anthony Paolone with JPMorgan.