IQHQ Sells Brighton Life Sciences Development Site For A Loss
Another life science developer has scrapped plans for development as the Boston lab market deals with oversupply.
The site of the former Marty's liquor store at 103 N. Beacon St. was sold by San Diego-based life sciences REIT IQHQ to NB Development, the development arm of New Balance, for $17.5M, according to public records.
The sale represents a substantial discount from the $27.5M price tag IQHQ paid in April 2022, the Boston Business Journal reported.
The life sciences developer proposed plans in April 2023 to build a 150K SF lab building on the site. The site stands a few blocks away from the REIT's approved three-building lab project at the former Sound Museum on North Beacon Street. That project has yet to begin development.
IQHQ has several Boston and Cambridge development projects in various stages including its acquisition and partial conversion of the Buckminster Hotel in Kenmore Square and the $1B Fenway Center project.
IQHQ and NB Development didn't respond to Bisnow's request for comment.
New Balance has been active in the Brighton neighborhood, where it has its 250K SF headquarters and its 15-acre Boston Landing project. The footwear company also proposed a 78-unit condominium building down the street from the site it acquired at 131 N. Beacon St.
The sale of the site formerly planned for lab development comes as Boston's life sciences market has several new projects sitting empty. The vacancy rate rose from 1.9% in the first quarter of 2023 to 18.6% in Q3 2024, with 77% of the increase tied to new or conversion projects, according to CBRE. The market slowdown has put projects that have delivered or will deliver vacant at risk of financial distress.
With the market's oversupply, many developers have shied away from advancing new life sciences projects or have even stalled ongoing projects. This is especially true in nontraditional life sciences submarkets like Somerville and Brighton, whereas established clusters like East Cambridge and the Seaport could be more favorable for developers.
"You're going to see Cambridge recover quicker," Berkeley Investments Director of Asset Management Dan McGrath said at a Bisnow event last month. "Then some of these other markets that are a little more far-flung, historically in the biotech sphere, take a lot longer to recover."
This slow recovery has led developers like IQHQ and Alexandria Real Estate Equities to offload sites where they had planned development — and to sell them for a loss. Alexandria in March sold a handful of South Boston industrial buildings where it had planned a lab development for $13M, down from its purchase price of $31.1M.
