SAN FRANCISCO | Mission Bay

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Friday, April 18, 2008
Gladstone seeking space in neighboring S.F. building
San Francisco Business Times - by Ron Leuty

The J. David Gladstone Institutes is negotiating to take 10,000 square feet more in Mission Bay as it lands research deals with pharmaceutical and biotech companies.

"We simply need more space for our translational research," said Gladstone President Robert Mahley.

The new space would increase Gladstone's footprint at Alexandria Real Estate Equities Inc.-developed 1700 Owens St.

Gladstone already has a research deal with Merck Research Laboratories, an Alzheimer's Disease partnership housed in 6,000 square feet at 1700 Owens, and over the past few months has struck HIV research pacts with Gilead Sciences Inc. of South San Francisco and JT Pharma of Japan.

Mahley expects Gladstone to win more research contracts in the coming months.

But such corporate-sponsored translational research -- aimed at turning academic discoveries into commercial therapeutics -- is a double-edged sword. The deals unlock an increasingly key funding mechanism for many nonprofit research organizations in an era of leveled-off National Institutes of Health grants. Yet each deal typically requires separate space, Mahley said, to ensure the confidentiality of lab findings.

"The labs in that space can run differently than they can in our basic science lab," Mahley said.

Gladstone will recruit researchers from the biotech industry to work on some of the new projects, he added, and the institutes could move into the new space in October.

An affiliate of the University of California, San Francisco, Gladstone consists of three research institutes centered on cardiovascular disease, virology and immunology, and neurological disease.

Gladstone's six-story, 189,000-square-foot home -- next door at 1650 Owens St. -- was financed with $145 million in state-supported revenue bonds and completed in 2004. It also leases space to Five Prime Therapeutics Inc.

At the time, the building consolidated several Gladstone locations in the city into one space.

Steve Richardson, senior vice president and Bay Area regional market director for Alexandria, would not comment about a potential Gladstone deal.

A Gladstone-Alexandria deal would put the 163,000-square-foot 1700 Owens near capacity. Alexandria President James Richardson told analysts in February that 96 percent of the building was leased or committed at the end of last year, and the Northern California chapter of the National Multiple Sclerosis Society plans to move in August to 5,400 square feet on the ground floor.

rleuty@bizjournals.com / (415) 288-4939

Source: http://www.bizjournals.com/sanfranci...ml?t=printable