Mass High Tech - February 16, 2007

Life sciences: Pushed or pulled to the suburbs?
Mass High Tech

Drawn by the advantages and amenities, life sciences firms of all sizes have been part of Boston's suburban landscape for more than 20 years. Why has this occurred? Major rent savings? Free parking? Easy expansion? Do these characteristics draw firms -- or are they side benefits of relocating?

As recent reports in Mass High Tech and other publications have noted, with increasing rents and decreasing availability of lab space in Boston and Cambridge, life sciences firms are also being pushed to the suburbs. A move to the suburbs, however, can be their pull as much as the push from the city.

Rent savings in the suburbs, which can be anywhere from 50 percent to 75 percent, have always been an enticement to locate outside of Cambridge, especially for startups. According to the third-quarter 2006 bioSTATus report from Richards Barry Joyce and Partners LLC, "Laboratory space (in the suburbs) is available at rates that are nearly half the cost of comparable Cambridge space, and the currently available supply is complemented by a development pipeline that could be constructed in a shorter time frame than proposed development sites in Boston and Cambridge."

Since more land is available, and permitting is often streamlined, more projects can be created.

Additionally, with easier access and staging, construction costs are typically meaningfully less, and project delivery times are faster.

Because lab buildouts can be extremely complicated, with requirements such as clean rooms, lab bench setups, specialized ventilation systems, fume hoods, and more, construction periods greater than six months are common. Faster delivery can be a real advantage, particularly for new firms.

Catering to young firms
Young life sciences companies generally find a welcoming environment in the suburbs, not only in terms of available space, but also regulations. Incubator concepts such as Emerging Technology Centers cater to these new firms, which need to put much of their seed capital toward research and development and growing the business. With access to turnkey facilities, emerging firms can focus on their science and not on their real estate.

Creative incubator programs, extending support to life sciences entrepreneurs in their initial ventures, attract those moving from university labs. Such programs typically feature a graduated rental schedule and guaranteed space after the initial lease term. No longer tethered to the cachet of a Cambridge address, clusters of these small firms dot the suburbs, creating vibrant communities that reinforce the viability of these new firms for customers and investors alike.

Established and thriving
In addition to newly formed firms, many well-established companies specifically choose suburban park settings to better focus and consolidate research efforts and prepare for product manufacturing.

Representing just three among many dozens of life sciences companies that selected the suburbs for their businesses are U.S. Genomics Inc., a Woburn company said to be pioneering single-molecule biology technologies; Thermo Fisher Scientific Inc. in Waltham, a world leader in analytical instruments since 1956; and Agencourt Bioscience Corp., a Beverly-based provider of genomic services and nucleic acid purification products.

The expansion possibilities afforded in the suburbs -- often cost-prohibitive and unwieldy (if even available) in an urban setting -- provide another significant advantage.

The convenience of having all major functions under one roof, on one level, is a "major plus." Something as seemingly simple as a delivery can be trying in a city like Cambridge with its access and parking challenges.

Choosing a lifestyle
Not only are life sciences companies maturing in the suburbs, their employees are as well. A suburban address is said to actually aid in recruitment efforts and employee retention.

Housing costs are lower and commutes are shorter. Parking is free and plentiful. For those without cars, public transportation often is a reasonable alternative.

Whether a startup with the hope of growing, or a larger company establishing its roots, firms are feeling the pull to the suburbs to establish labs.