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New Blackstone Life Science Fund Has Nearly 1/4 of Its Properties in San Francisco & Seattle

By Jon Peterson

New York City-based Blackstone is now marketing its Blackstone BioMed Life Science Real Estate fund to investors. The portfolio in this commingled fund currently has 19 percent of the assets in San Francisco and another 5 percent in Seattle, according to information released by the New Mexico State Investment Council board meeting last week.

The sovereign wealth just approved a $50 million commitment into the BioMed Fund, according to information provided by New Mexico.

Blackstone declined to comment for this story. 

Some examples of assets already in the fund located in San Francisco and Seattle are Gateway Pacific I and Pacific Research Center in San Francisco and 530 Fairview and Vue Research Center in Seattle.

The total operating portfolio in the BioMed fund totals 11 million square feet. Besides the assets in San Francisco and Seattle, the remaining parts of the portfolio are located in three other major markets. Approximately 54 percent of the allocation is in the Boston/Cambridge market, another 17 percent is in San Diego and the remaining five percent in Cambridge in the United Kingdom.

The current properties in the BioMed fund amount to a total of 80 assets, which represents at least 80 percent of BioMed’s total portfolio value. The assets in the commingled fund are roughly 95 percent leased with 75 percent of the occupants described as investment grade tenants. The average weighted lease term for the tenants in the portfolio is seven years.

The commingled fund also has a substantial development pipeline, in-process developments and land banking. The in-process developments are currently more than 50 percent pre-leased. It’s not clear at this time the amount of square feet in the development pipeline or where these assets are located.

Half of the commitment from New Mexico is in the form of new capital and the other half of the capital that has been taken out of Blackstone Real Estate Partners VIII fund. The sovereign wealth fund had approved a $75 million commitment into the Blackstone Real Estate Partners VIII fund in 2015. One year later BREP VIII had acquired BioMed Realty Trust for $8 billion.