Breakthrough Properties Raises $3B to Develop Life Sciences Space

It is the largest real estate fund dedicated exclusively to the life sciences sector

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Funding is surging for life sciences real estate development.

Breakthrough Properties, a joint venture of Tishman Speyer and Bellco Capital, announced today that it closed $3 billion in direct capital and co-investments, to scale a global portfolio for early-, mid- and late-stage life sciences companies. The Breakthrough Life Science Property Fund finances the JV’s ongoing developments, which are in various stages of design, construction and pre-development, and fuels new development opportunities throughout the United States and Europe. 

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The fund was raised from a group of institutional investors, sovereign wealth funds and high net worth individuals spanning four continents. Excluding recapitalizations, it is the largest real estate fund dedicated exclusively to the life sciences sector, according to CBRE and JLL research.

CBRE estimates $25 billion in equity will be deployed into health care real estate this year due to the overwhelming bullish sentiment in its most recent investor survey, along with the resiliency of the sector during the pandemic and persistent demand. Indeed, Breakthrough’s funding announcement comes shortly after Blackstone announced its inaugural royalty and structured credit-focused life sciences fund, called Blackstone Life Sciences Yield, at $1.6 billion.

Through a range of campus developments, lab conversions and StudioLabs, and a proprietary flex lab program, Los Angeles-based Breakthrough said it provides a range of property types for the life sciences sector, from venture-backed discovery companies to established big pharma anchors.

“There is an acute and accelerating need for well located, cutting-edge lab space,” Tishman Speyer CEO and Breakthrough co-Chairman Rob Speyer said in a statement. “The Breakthrough Life Science Property Fund can enable us to deliver more of these projects across the U.S. and Europe.”

Breakthrough was founded in 2019 and has become one of the most active players in the life sciences sector with 4.6 million square feet of projects in the pipeline across San Diego, Boston/Cambridge and Philadelphia, as well as Amsterdam, Oxford and Cambridge in Europe.

Breakthrough’s rapidly growing portfolio includes The 105 in Boston, which is fully leased to CRISPR Therapeutics and will open later this year. In 2021, Breakthrough broke ground on its 515,000-square-foot Torrey View development, a 10-acre research and development campus in San Diego that signed a major pre-lease with the biosciences arm of global medical technology company Becton, Dickinson and Company. Its Torrey Plaza campus, an office-to-lab conversion, is leased to a range of innovative companies, including Tandem Diabetes Care, Janux Therapeutics and Protego Biopharma.

Gregory Cornfield can be reached at gcornfield@commercialobserver.com.