After Years Of Being 'Turned Away,' Life Sciences Firms Now Have Options In Atlanta
Georgia's life sciences industry is expected to boom in the coming years as developers begin to meet what has been pent-up and fast-growing demand.
Metro Atlanta Chamber Chief Economic Development Officer David Hartnett said life sciences “is the fastest-growing cluster that the chamber is involved in,” at Bisnow's healthcare and life sciences real estate event Tuesday in Midtown Atlanta. But the lack of dedicated space has been a major obstacle to capturing the rising demand to be in Metro Atlanta.
“As an economic developer, I can tell you I turned away ... dozens of companies that could not find lab space,” Hartnett said. "We just said, 'Bye-bye.' Nothing we could do."
Panelists at the event said they hope two major life sciences projects in Atlanta, which will add more than half-a-million square feet of lab and office space to a market that has little product to speak of, will help to cement the region as a new industry hub. Those projects could encourage developers to add more life sciences-dedicated space to the region moving forward.
“I remember [Georgia Department of Economic Development Director EJane Caraway] talking about just what a tragedy it is, how many companies want to be here, and how many companies she's constantly turning away at the state level,” Trammell Crow Senior Vice President Katherine Lynch said at the event. “The same thing at the city level with the Metro Chamber team as well. Just how many companies want to be here.”
CBRE, in a recent report, highlighted Metro Atlanta as one of the nation's fastest-growing life sciences markets. Between 2019 and 2020, the number of life, physical and social science jobs jumped 15% to 18,600, the biggest percentage gain across major markets in the U.S.
While Metro Atlanta has robust healthcare and medical office supply — more than 18M SF, with 1.7M SF available, according to a recent Cushman & Wakefield report — very little purpose-built lab space has been developed in recent years. But that is starting to change.
Trammell Crow, in a joint venture with Georgia Tech's nonprofit technology investment, incubator and development arm, Georgia Advanced Technology Ventures, has broken ground on Science Square Labs, a 365K SF speculative lab and office tower along North Avenue and Northside Drive next to Georgia Tech's North Avenue Research Area, a little more than a mile west of Tech Square in the heart of Midtown.
Transwestern, Sharecare and an unnamed West Coast foundation donated money to help launch the Center for Global Health Innovation, which is opening a life sciences innovation center with collaborative office and lab spaces in four stories of Tower Square, the 47-story former AT&T tower in Midtown.
"Now I'm able to say in the next one, three, five, six years we will have lots of infrastructure because you all are doing your job as well and building space," CGHI CEO Maria Thacker Goethe told the Bisnow audience. "That is one thing that right now we do not have, but at least I can say that it's coming. It's coming in very short order."
The CGHI not only will provide lab space, but also offers a way for a variety of different companies within the life sciences ecosystem to collaborate together on common ground, a feature that is popular in the technology industry in Atlanta but doesn't really exist now for life sciences, Transwestern Executive Managing Director Clark Dean said.
“The biggest problem that exists right now not just in our country but around the world, it's not necessarily the lack of technology. It's not the lack of knowledge or innovation or even capital. It's the lack of trust,” Dean said. “We're building an ecosystem for life sciences, for small startups and all elements, including venture capital and mid-to-large companies and nonprofits and community groups to bridge tech to the communities that need them. All the while, [we're] building trust.”
Goethe echoed Dean's sentiment on the added dimension for collaborative life sciences spaces.
“It's not just about having a wet lab and an office,” she said. "It's about really creating these intentional meetups and connections that can all be done in one space."
Interest in Georgia's life sciences real estate is coming from a variety of sources — companies like Moderna wanting to branch out from the major life sciences hubs like Boston or California to help reduce expenses, smaller companies wanting to tap into the talent pool being produced by Georgia Tech, Emory University and other colleges and universities in Atlanta, and companies that were founded here but moved elsewhere due to the lack of space, panelists said.
“We got calls from real estate agents. We got calls from investors. We had people flying in from Houston on private jets saying, 'I want to buy, build, acquire, get engaged in life science.' That's never happened before,” Hartnett said. “If we were to say in five years from now what we think the life science industry is going to look like, we will shortchange ourselves.”
