PMB, Montgomery Street Plan for $280 million Life Science Park near Denver – Commercial Real Estate Executive

Coal Creek Innovation Park. Image courtesy of PMB

The $280 million Coal Creek Innovation Park, the first speculative purpose-built life science project in Boulder County, Colo., will be built in downtown Superior, Colo., following local approval this week of the 365,000-square-foot development.

PMBa national healthcare real estate developer and commercial real estate investment firm Montgomery Street Partners expect to break ground in the second quarter of 2023 and complete development in the third quarter of 2024.

Phase one will include 27,000 square feet of owner-fitted spec space to enable rapid occupancy by growing companies in need of high-quality lab space. Other plans call for three office and laboratory buildings ranging from 85,000 square feet to 150,000 square feet and a fourth building with ground-floor retail and structured parking on the site.

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The buildings will have efficient floor plates, 16-foot floor-to-floor heights and flexible infrastructure to accommodate a variety of offices, laboratories and R&D applications. Shared lab services will be available to all tenants, including RODI water, dedicated lab water, compressed air, glass washing and a lab waste system.

The Coal Creek Innovation Park will be 10 minutes from Boulder and 25 minutes from Denver. RTD’s Flatiron Flyer rapid transit bus service and the US 36 Bike Trail provide multimodal transportation options between Boulder and Denver. It is one of the last infill locations in Boulder County south of Boulder, with visibility from US 36 and one of the last available commercial properties in downtown Superior.

CBRE is hired to market life science developments. Perkins and Will will deal with architecture and design. Other team members include Associate Engineers Inc. to provide MEP engineering and BNBuilders to provide pre-construction services.

A tight life science market

Ben Rosenfeld, senior vice president of development at PMB, said in a prepared statement that there is a significant unmet need for institutional-quality space in Boulder County. He noted that existing inventory largely consists of assets with less than 60,000 square feet that are converted single-story flex properties and offer limited expansion opportunities for high-growth and more mature life sciences companies. In addition to providing nearly 400,000 square feet of lab space designated for research and development, Rosenfeld said the project will also offer generous tenant improvement assistance and up to 50,000 square feet of speculative lab space.

Eric Abrahamson, senior vice president, CBRE, said in prepared remarks that life science companies are looking to locate and expand in the Boulder/Denver area. Despite being attracted to the region’s highly educated and skilled workforce and ecosystem of educational and research institutions, Abrahamson said it has been difficult to find available lab space in Boulder County.

Vacancies at Boulder life science properties were just 0.3 percent at the end of the second quarter, according to a CBRE survey. On the demand side, the market has supported more than 1 million square feet of active life science tenants for nearly two years. Earlier this year, CBRE analyzed the top US markets for life science talent and the Denver/Boulder region was named the 11th best market overall by the number of life science researchers increased by 20 percent from 2015 to 2020.

The Newmark 2022 Mid-Year Review of Life Sciences and Market Clusters The report notes that the market is shifting from mostly as-is deals to investors funding lab-ready spaces and speculative developments to meet market demand. Newmark estimates the size of the Denver/Boulder life science market at 3.5 million square feet, but says year-to-date real estate investment volume has already outpaced the 2021 total of $491 million. The report notes that limited large blocks have caused some businesses to relocate along the US 36 corridor.

There are major players already active in the Boulder area. A joint venture of Tishman Speyer and Bellco Capital known as Breakthrough Properties, acquired a four-building asset in Boulder last month, with the intention of creating a 9-acre campus that includes office, lab and flex space. Breakthrough Properties has raised $3 billion in capital and co-investments for a fund to scale life science companies.

In April, BioMed Realtya Black stoneowned company, acquired Flatiron Park, a 1 million square foot, 22 life science building and office campus in Boulder for just over $600 million from a joint venture of Crescent Real Estate, Goldman Sachs Asset ManagementReal estate business and Lionstone Investments. The campus is about 90 percent leased to a mix of life science and technology companies.

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