On Thursday, IQHQ, the life sciences real estate developer previously known as Creative Science Properties, announced that it has successfully completed a second $1.7 billion equity raise from new and existing strategic partners.
This second funding round comes less than a year after IQHQ was founded (in February 2020) by biotech real estate investment pioneer Alan Gold. A company release in connection with the announcement said IQHQ is now “well funded and well positioned” to pursue the company’s dynamic development pipeline, which includes an anticipated 4.4 million square feet of cutting-edge life science projects in Boston, San Francisco and San Diego, and a robust pipeline of other property acquisitions.
“We are honored by the trust placed in us by our shareholders for the completion of this significant capital raise, which validates IQHQ’s solid strategy, our exceptional team, and our success in identifying and securing premier life science projects and developments in top markets,” said IQHQ CEO Steve Rosetta, adding that the company is “just getting started” on its ambitious plans for growth.
No signs of slowing down
“Interest in the offering was exceptionally strong due to the incredible momentum that IQHQ has achieved since its formation earlier this year, and the unmatched track record of its senior management team in delivering strong investor performance and scaling public REITs,” said Jamie Graff, Managing Director, Co-Head of Real Estate of Raymond James, which led the financing round. “During a turbulent year, IQHQ’s focus on the commercial life science sector has been a winning strategy as the market shows no signs of slowing down – quite the opposite, despite the economic headwinds associated with the pandemic, life science real estate has remained steady and all indications point to continued growth.”
Among the investors was CenterSquare Investment Management, the Philadelphia-based global real assets investor with over $11 billion in managed client assets, which invested $158 million in the round.
“The strength of our conviction in the life sciences sector is only matched by our confidence in IQHQ’s ability to meet the highly specialized demand for real estate in this exciting and rapidly expanding asset class,” said Todd Briddell, CEO and CIO of CenterSquare. “This management team has executed on a highly scalable vision that continues to deliver state-of-the-art office, lab and R&D space for premier tenants who are focused on critical innovations that improve and save millions of lives. We are extremely proud to be a part of this story on behalf of our investors and look forward to IQHQ’s ongoing success.”
CenterSquare expects demand for life science real estate to increase in the coming decade, due to an aging population and accelerating global need for vaccines, therapeutics and diagnostics. Their investment aims to improve IQHQ’s overall ability to execute on future pipeline transactions, as well as underpin the existing portfolio and balance sheet.
“We are excited to welcome CenterSquare as a strategic investor in our company,” said IQHQ CEO Steve Rosetta. “The firm has a clear understanding of our business model and the growth opportunities that lies before us, and their experience in both public and private real estate investment will serve our team particularly well over the long term.”
Despite its relative youth as an investment trust, IQHQ has wasted no time in quickly assembling a portfolio of marquee biotech properties on both coasts.
In July, IQHQ acquired Alewife Park, a 26.5-acre development in Cambridge, Massachusetts that currently serves as the corporate headquarters of construction chemicals producer GCP Applied Technologies, and includes nearly 290,000 gross square feet of office, laboratory and R&D space, directly adjacent to the Boston MBTA Red Line’s Alewife Station. The acquisition added to IQHQ’s rapidly expanding portfolio of assets in Greater Boston, including the 285,000-square-foot lab and office facility at 109 Brookline Avenue in Boston, the 200,000 Innovation Park campus in Andover, Massachusetts, and the Fenway Center project, a state-of-the-art lab, office and retail space in development.
IQHQ has also scaled its presence on the West Coast. In September, IQHQ launched a new brand in connection with its acquisition of a major San Diego waterfront site previously known as the Manchester Pacific Gateway. IQHQ’s San Diego Research and Development District (RaDD) will span eight-plus acres and a radius of three city blocks, designed to showcase San Diego’s rising reputation as the third-largest life science market in the United States and home to an 82 percent increase in life science employees over the past decade. RaDD is also the largest urban commercial waterfront site on California’s Pacific Coast, with its first development phase expected to be completed in Summer 2023.
“The Research and Development District is exciting on so many levels – not only does it represent our first acquisition in the San Diego region, which IQHQ is proud to call home, we also have an opportunity to create the first truly urban waterfront campus dedicated to the advancement of life sciences,” said IQHQ President Tracy Murphy, upon completion of the waterfront transaction. “Once complete, the RaDD will be a premier development that will spark and define the region’s commercial life science market in San Diego similar to that of the Seaport District in Boston.”