 |
| Hani Baothman |
PHILADELPHIA,
PA, Dec. 2, 2020 – JLL Capital Markets announced today that
it has closed the $225 million recapitalization of Arborcrest Corporate
Campus to Saudi Arabia-based Sidra Capital (Sidra).
The
sale of the five-building, 855,600-square-foot suburban office campus with
a significant life sciences and biotech tenancy in the suburban Philadelphia
community of Blue Bell, Pennsylvania, demonstrates a growing trend of Middle
Eastern investors taking a harder look at life sciences assets.
JLL
arranged the transaction between Spear Street Capital and Sidra, which
acquired a 90-percent stake in the campus. Spear Street Capital has retained a
10-percent ownership stake in the asset.
Completed
in two phases in 2015 and 2019, Arborcrest’s healthcare, life sciences and
biotech tenancy, which was crucial to Sidra’s interest, includes Signant
Health, a leader in clinical trials; Pharmaceutical Research Association, a
clinical research organization; and Abington Memorial, an outpatient healthcare
facility; along with several tenants that support healthcare administration
functions.
 |
| Audrey Symes |
According to Hani Baothman, Chairman of Sidra, demographic changes and the limited capacity for working remotely led Sidra to aggressively pursue life sciences assets, as COVID-19 has brought this sector into renewed focus, and these longer-term trends are driving and will continue to drive growth.
Sidra’s
investment strategy is to identify recession-resistant assets, and the firm
generally remains sector agnostic, focusing more on recognizing and then
investing into long-term trends. To diversify, they are looking at the life
science industry, which was growing rapidly before the pandemic.
“It
is a sector we identified due to its defensive nature especially when space is
being used by pharmaceutical and biotech companies for research development and
even manufacturing,” Baothman said.
“Our
overall strategy is to invest in defensive and cyclical commercial real estate
and real estate tenants, regardless of where we are in the market cycle.
The
healthcare and life sciences industry has been front and center throughout the
year, as the pharmaceutical and biomedical industry is focused on creating effective
COVID-19 vaccine and therapeutics to treat the virus.
 |
| Claudio Sgobba |
With a spotlight on this industry, commercial real estate investors are showing a growing interest in assets with strong life sciences and biotech tenancy, given the industry’s stability throughout the pandemic and strong outlook into 2021.
“The
past several months have demonstrated how critical the life sciences industry
is to our economy,” says Audrey Symes, Research Director, JLL Healthcare
and Life Sciences.
“There
is a significant increase in general overseas interest in life sciences
investment, especially because the U.S. is the clear leader in the industry.”
According
to JLL Research’s 2020 Life Sciences Real Estate
Outlook, life sciences real estate capital markets are
well positioned for relative outperformance in 2020.
Transactions
are occurring at pre-COVID pricing in many of the top clusters. The sector is
increasingly attractive to Middle Eastern-based investors who have invested
$389.2 million in the sector year-to-date, which includes the Arborcrest
transaction, following two years of low activity, including zero investment
dollars into life sciences properties in 2018.
According
to JLL, the Arborcrest sale is the largest suburban Philadelphia life science
trade during COVID. It also ranks as the sixth-largest suburban sale in a
primary or secondary U.S. market.
JLL’s Capital Markets team leading the transaction included Managing Director Claudio Sgobba and Senior Managing Director Doug Rodio.
Doug Rodio
“Arborcrest fits Sidra’s unique and targeted investment strategy,” Sgobba said. “It is our pleasure to serve the Sidra and Spear Street teams. Understanding a client’s strategy allows us to present the best investment opportunities specifically for their requirements.”
“Sidra’s
commitment to placing capital in Greater Philadelphia with a proven partner
like Spear Street further cements JLL’s thesis that the Philadelphia region is
near the top of the target list of geography for many of the most discerning
cross border investors today,” Rodio added.
For
more news, videos and research resources on JLL, please visit our newsroom.
CONTACT:
Kimberly
Steele,
JLL Senior Associate
Public
Relations
Phone: +1
713 852 3420
Email: Kimberly.Steele@am.jll.com
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