Back to All News

In The News

January 26, 2023

BioMed Realty Showcases Flexible Lab Spaces and Unique Amenities at Dexter Yard

Puget Sound Business Journal / By Marc Stiles

The latest in Seattle's crop of life science buildings is open, and inside enterprises are ramping up to develop life-saving therapies.

Mike Ruhl, vice president at project developer BioMed Realty, is eager to see what they come up with in Dexter Yard's two towers, which occupy the full South Lake Union block at Dexter Avenue North and Roy Street.

“You get to see things happen that are going to change the world 10 years from now,” Ruhl said Tuesday as he stood in a gleaming lab, which the Allen Institute has leased.

The 15-story Dexter Yard, which in addition to lab and office space has a field house with an indoor/outdoor sports court, space for a pub and rooftop decks overlooking Lake Union, is opening into a softening life science sector.

Nationally, venture capital is pulling back and lab occupiers are waiting for more economic certainty before committing to leasing pricey lab space. Ruhl said 45% of the 528,000-square-foot Dexter Yard has been leased.

It's why BioMed has decided to make four floors in both towers speculative, plug-and-play lab space with moveable workbenches that can be reconfigured. All tenants, large and small, desire this sort of space, Ruhl said.

“It's just where the market is,” he said, adding most tenants in the market are seeking 10,000 to 20,000 square feet for terms of around two years.

BioMed has a portfolio of around 1 million square feet and plans to more than double that.

“We want our tenants to grow with us,” he said.

Ruhl said the cost of building out lab space has increased in recent years from around $300 to $450 a square foot. Leasing ready-for-science space eliminates this cost.

“The life science market has now changed in that venture money is a little more conservative. Companies don't want to be using their capital to build out spaces,” he said.

Tenants are paying costs in the form of higher rents.

Ruhl said BioMed isn't negotiating traditional leases that require tenant improvements, but if the company were, the annual per-square- foot rent would be in the mid-$80 range. Ruhl said the turnkey suites rent for $96 a foot. These rates do not include a tenant's cost of insurance, property tax and common area maintenance.

Because amenities are as important as lab space to today's tenants, the project includes the sports court, pub area and decks. Some of these amenities, like the pub, will be used to draw people from the neighborhood into Dexter Yard.

“Before we even started talking about the building, we started talking about the ground plain,” said Ruhl, who noted Dexter Yard is at the center of much of South Lake Union's biotech development activity with a total of around 2 million square feet of under-construction and planned commercial development as well as thousands of new apartments.

Working with project architect SkB, BioMed officials talked about how Dexter Yard could bring neighbors and others inside.

“The pub was a really cool first idea,” he said.

It will look down into the field house with its 22-foot ceilings and big roll-up doors. With seating for 600 people, the space also can be used for lectures and other meetings.

Developing life science space “is not for the faint of heart,” Ruhl said. “It's highly intensive.”

There are vents that exhaust to the roof and mechanical and electrical equipment all of which is heavier duty and more complicated than a standard office building.

Ruhl said BioMed has “a really strong partnership” with general contractor Turner Construction and a set of subcontractors.

“You have to have that because these are very complicated systems,” he said.

The cost to develop Dexter Yard was not available, but in 2013, when the full block was contaminated by chemicals from dry cleaning and motor vehicle repair operations, the assessed value was just $2,000. Now that Dexter Yards is open, it's over $413.8 million.

January 26, 2023

share on linkedin