Think “innovation” and you might picture some scrappy entrepreneurs toiling away in a kitchen or garage, hoping the landlord doesn’t notice what they’re up to. But the reality is that turning science into big business often requires far more sophisticated infrastructure—and the landlord who provides that infrastructure sometimes has one of the best windows into the process.
For the life sciences industry, one of the largest landlords, and closest observers, is Alexandria Real Estate Equities. The Pasadena, CA-based urban office real estate investment trust (REIT), founded in 1994, has grown into one of the country’s largest developers of world-class collaborative science and technology campuses. Alexandria has put up buildings in virtually every key life science cluster in the U.S., from San Francisco, San Diego, and Seattle on the west coast to Boston, New York, and Research Triangle Park out east. Its campuses, often featuring dramatic lobbies, community organic gardens, conference and event centers, restaurants, and collaboration spaces, have in many cases become centerpieces of the local innovation ecosystem.
Lately, Alexandria is aggressively expanding its reach. It has recently announced two new startup platforms designed to support the growth of seed stage or very early stage companies—the AgTech Accelerator in Research Triangle Park, NC, and Alexandria LaunchLabs in New York City. Both are accompanied by separate new investment funds of between $10 million and $25 million. Alexandria already has its own venture arm, Alexandria Venture Investments, and is a co-founder of Accelerator Corp., a roughly $60 million early stage VC fund (more on the new funds and Accelerator below). Meanwhile, the company has landed a major deal to build Uber’s headquarters in San Francisco’s Mission Bay area—one of several projects ongoing outside its traditional focus on life sciences. Amidst such moves, its stock hit an all-time high of $114.62 per share on Sept. 8, [Disclosure: Alexandria is a business partner of Xconomy—underwriters, sponsors, and partners have no special influence on our editorial operations.]
The company’s presence in key clusters around the U.S. gives Alexandria co-founder and CEO Joel Marcus, who sits on several boards, including that of BIO (the Biotechnology Innovation Organization) and the Foundation for the National Institutes of Health, a unique view of the innovation landscape. I recently spoke with him about his vision for Alexandria, its new programs for startups, key workforce trends (especially those being driven by the millennials), what he sees ahead for the economy, and the need for more leadership in the life sciences arena, among other topics. Following is an edited transcript of our conversation.
Xconomy: Alexandria doesn’t just build buildings. So I thought a good place to start would be your own description of what Alexandria is, and how that might differ from people’s vision of a real estate company?
Joel Marcus: Over time we’ve evolved our business model to focus on four pillars. First, the real estate. Second, is venture capital, which we think is indispensable to the execution of our real estate mission and our preeminent position in the life-science ecosystem. Third, is thought leadership: it’s crucial to convene high-level thought leaders from across the industry, and we’ve built a collaborative meeting platform to discuss global health challenges and drive progress forward. Then, fourth is corporate social responsibility. We focus on corporate philanthropy, and also the area of sustainability.
X: For people that haven’t been to one of your campuses, how do you describe them?
JM: They are, in fact, campuses. They provide collaborative and innovative environments. We provide great fitness centers, amazing food eateries, like Tom Colicchio’s Riverpark at our New York campus. We have the largest urban garden in New York City (shown below), and have similar gardens on many of our campuses. Our campuses also provide great world-class conference facilities, and we also do a lot of hands-on mentoring. In New York, we’ve recently launched LaunchLabs, which is designed for very early- and pre-venture stage entrepreneurs and companies. We’re providing space, mentorship and a seed fund to help their growth. So it ranges. We try to be very much of a full service operation.
Highly amenitized campuses are now at the forefront of leading companies’ desires. They provide a great tool for recruiting and retention, which these days is becoming very important, especially given that in 10 years the millennials, who want to live where they work, will make up three-quarters of the workforce. Being in a one-off building, or being in a half a floor or one floor of a high-rise building that doesn’t have your name on it, that just doesn’t do it anymore.
X: From your position in clusters around the country, you have a unique view of the economy. What do you see?
JM: On a macro basis, we’re seeing a slow growth mode around the world and the U.S. seems to be in the brightest spot. Therefore, there’s a huge influx of capital seeking safety and yields, and our stock has been one of the great beneficiaries of that—coming from a low in the $70s to about $110 today, just since February, which for a REIT is a pretty dramatic move. The Fed wants to ramp up interest rates while the rest of the world is trying … Next Page »