We expect that the life science sector will be minimally affected going forward as evidenced by venture financing rounds that closed in March is expected and continue to do so in April, which I'll touch on in more detail shortly. Country of residence : Unknown. Alexandria Real Estate Equities, Inc. (ARE) Q1 2023 Earnings This was a great outcome for Alexandria as we were able to partner with a world-class investor to monetize the value creation and secure the capital for the remaining spend in an accretive manner, while retaining control of the asset and all management fees. Thanks Peter. We were the first group that identified life science real estate as a niche, which could both garner and deploy capital to an important industry, which really had no major infrastructure capital going into it in the early 1990s, Marcus says. Since co-founding the company in 1994 as a garage startup with $19 million in Series A capital and a mission to advance human health, he has led the remarkable growth of Alexandria into an S&P 500 company that, as of December 31, 2021, has a total market capitalization of $44 billion, and a total equity capitalization of $35 million that ranks it among the top 10% of all publicly traded U.S. REITs. The court previously dismissed an earlier version of the suit on similar grounds but gave Alexandria an opportunity to resubmit it with more evidence. And then I guess, Dean, just back to your comment on the $25.8 million of gains you might show. Now our strong occupancy was in line with our expectations. Our mission is to create clusters to ignite and accelerate the worlds leading innovators in their pursuit of advancing human health by curing disease and improving nutrition. Got it. Thank you, Paula, and welcome, everybody, to Alexandria's first quarter 2023 Earnings Call. It sounds like that's where the biggest incremental change was when you're looking at 2023 and 2024 on lease unleased new supply. Yes, thanks. So we've, I think, done an extraordinary job of managing rent collections and monitoring all of our tenants in a way that I don't think anyone else could even imagine. Founded in 1994, Alexandria pioneered this niche and has since established a significant market presence in key locations, including Greater Boston, San Francisco, New York City, San Diego, Seattle, Maryland and Research Triangle. Flexing capital plan and turning to equity as a solution is not really something we are contemplating. And what we saw in 1994 in the embryonic days of the life science industry is multiplied geometrically today, 30 years later, as Steve Jobs said, the 21st century will be the century of the intersection of biology and technology innovation. RUNLABS plans to provide offices and shared laboratory space to life science firms and is starting in Europe with a 150,000-square-foot building that Steven Marcus hopes to open in Paris next year. It invests in disruptive life science, agri-food tech, climate innovation, and technology companies. As for long-term risk driven by instability of regional banks, unlike some tech companies that maintain significant cash and deposit accounts, our tenants largely rely on safer third-party custodial and sweep accounts to minimize cash deposits. Steven Marcus has asked the US Trademark Trial and Appeal Board to take Alexandrias registered trademarks off the books. I think Hallie indicated, we have a pretty methodical deep and judicious approach that has always been there. WebMarcus co-founded Alexandria in 1994 as a garage startup with $19 million in series A capital and, as chief executive officer from March 1997 to April 2018, has led its growth into an S&P 500 company with an approximately $18 billion total market capitalization and a total shareholder return of approximately 1,300 percent since the companys IPO When families or their loved ones are facing illness or injury and can benefit from some guidance, we have a mechanism here for them to reach out and be connected with an expert who can, hopefully, offer them a second opinion or help them get in to see a doctor they might not otherwise have been able to see. I think the way to look at our capital point is what we are doing internally, like we did in the current quarter for earnings as well as over the last several quarters and prep for initial guidance for Investor Day this year was to really challenge the uses of capital. But that's been filled in by some other new folks coming in that want exposure that are also high-quality institutional investors. Next question comes from Jamie Feldman with Wells Fargo. Continued innovation in medicine is an absolute national priority and the transformative work of our tenants in the industry is critical to addressing the massive unmet medical need. Alexandria Given that the receipt of cash flow is over a year away, it's difficult to translate the valuation to an operating cap rate. So information comes in different ways in different fashions. The health of ARE's best-in-class life science tenant base and innovation is a long-term driver of life science industry growth. WebThe Alexandria juggernaut, now with a $44B market capitalization, outperformed its expectations for last year, standing out in a year of superlative performances across the industry. Joel S. Marcus Executive Chairman and Founder at Alexandria Real Estate Equities Well, and also, historically, if you go back to my comments, I said we have tried It has been in the works for a long time, but it has been catapulted by the M&A activity. The firm has maintained strong financials despite the ongoing economic storm, according to Executive Chairman and Founder Joel Marcus. In addition, we've built an irreplaceable world-class asset base of robust and highly differentiated properties and campuses that attract a diversified best-in-class tenant base who values our expertise and operational excellence by providing 75% to 85% of our leasing quarter-to-quarter. With me today are Peter, Dean, Hallie and Dan. Its undoubtedly a differentiator that has borne fruit.. Yeah, Rich, it's Dean here. Now this was an exceptional rental rate growth, GAAP at the highest in the Company's history, both GAAP and cash rental rate growth higher than the strong rental rate growth for the full year of 2022 and 2021. While the outlook for Alexandria certainly looks solid, one thing that people are watching is the health and liquidity of the underlying biotech industry, Rodgers notes. Get short term trading ideas from the MarketBeat Idea Engine. Marcus introduced the companys thought leadership platform in 2011, when he co-founded the renowned Alexandria Summit. View which stocks are hot on social media with MarketBeat's trending stocks report. Steven Marcus, 41, the eldest of Joel Marcuss three children, started two companies, London-based RUNLABS UK and Dublin-based RUNLABS Ireland, that plan to house life science firms in Europe. [12], In July 2018, the company acquired 219 East 42nd Street, the headquarters of Pfizer, for $203 million in a leaseback transaction.[13]. The company leased 4.1 million square feet during the fourth quarter alone. Yeah. So it made a lot of sense. I'm going to go and briefly touch on our development pipeline, construction costs, leasing and asset sales and then hand it over to Dean. We all have a responsibility to ensure that we never forgetthat we continue to pay tribute to those we lost; recognize the heroism, sacrifice and resilience of so many; and share lessons learned with new generations. But they're all basically shutting down in the near term in the scheme of things, they're relatively small. So you were referring to the pipeline that's under construction, 5.5 million square feet, plus another $1.2 million near term. One of Alexandrias largest efforts is OneFifteen, a data-driven opioid treatment and recovery campus in Dayton, Ohio, created in partnership with Verily, the life science arm of Google-parent company Alphabet. So we feel good about it, and we'll keep an eye on things as we go through the next two quarters. contact@marketbeat.com I just want to make clear that there's a line item that adjusts the future pipeline for square footage that's sitting in operations, but those cash flows are in the operating portfolio of, Tony, as you pick up that NOI to value the company. Just some new recent starts and one, large one in particular in South San Francisco, you made up most of that change. And I mean, if you looked at, say, the Rubius situation, we would say that if there's a management change that then you look at -- or you put that scrutiny at a higher level when it happens. And apologies if I missed it, but do you have any lease termination since this quarter? When typing in this field, a list of search results will appear and be automatically updated as you type. LEADERS Interview with Joel S. Marcus, Executive Chairman Joel Marcus co-founded Alexandria Real Estate Equities, Inc. in 1994 as a garage startup with $19 million in Series A capital. Yeah. Then we also feel its important to support military families. Chairman, Chief Executive Officer, and Founder For Alexandria, these buildings stayed open and operational because its very difficult to do lab work from home.. (844) 978-6257. Briefly on a high quality tenant roster, Alexandria really is the brand for life science real estate, has built long-term trusted relationships and is a true partner to the life science industry. Expands Its First-in-Class New York City Regional Life Science Cluster Franchise with the Strategic Acquisition of 219 East 42nd Street in Manhattan, Subject to a Leaseback", https://en.wikipedia.org/w/index.php?title=Alexandria_Real_Estate_Equities&oldid=1141941026, Companies listed on the New York Stock Exchange, Financial services companies established in 1994, Real estate companies established in 1994, Real estate investment trusts of the United States, Official website different in Wikidata and Wikipedia, Creative Commons Attribution-ShareAlike License 3.0. Business data for Alexandria Real Estate Equities, Inc.: This page was last edited on 27 February 2023, at 17:43. In addition to biomedical research and STEM education, we also do a lot in our local communities the communities in which we live and work and in which our tenants live and work. So that's maybe a way to frame it, but I think you'll be pretty impressed. Cost of materials and supply chain volatility were the initial drivers of construction inflation, but now the primary driver is labor with a triple whammy of wage increases, shortage of workers and the inefficiency of the remaining labor force due to the retirement of older, more skilled labor. Anyone contemplating a speculative development these days will have to contend with these delays and associated high costs, which will put the feasibility of building and financing the project at considerable risk. Steven Marcuss firms issued a brief statement, saying RUNLABS is pleased to see justice rendered.. As CEO from March 1997 to April We just gave -- so you saw there was no changes in capped interest down in the details, obviously, if you -- we did on a number of projects review strategically what we wanted to do and a number of them were put on temporary hold. A lot of people have left these companies and are now starting companies. And if so, how much? Joel S. Marcus - Foundation for the National Institutes of How challenging is it to disrupt that model? With me today are Peter, Dean, Hallie and Dan. I don't think we see demand dropping off a cliff here at all. Alexandria Chief Executive Officer and Co-Chief Investment Officer, Co-Chief Investment Officer and Regional Market Director - San Diego, Managing Director at Alexandria Real Estate Equities, Executive Chairman and Founder at Alexandria Real Estate Equities, Vice President, Science and Technology at Alexandria Real Estate Equities, Chief Executive Officer and Co-Chief Investment Officer at Alexandria Real Estate Equities, President and Chief Financial Officer at Alexandria Real Estate Equities, Co-Chief Investment Officer and Regional Market Director - San Diego at Alexandria Real Estate Equities, How to Invest in the Top Grocery Stocks for This Year, Best Bank Stocks to Invest in Ahead of Rising Interest Rates, Lucid Group, Inc. 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And the other -- if you add the other $119 million to be funded to completion and divide it by the 33% we sold, you get $561 million. Joel Marcus is 72, he's been the Executive Chairman of the Board of Alexandria Real Estate Equities since 2018. And I think in a tougher macro environment, it's kind of thought to prune and rightsize you see what we've done last year would be a good example of -- we sold a set of really good high-quality workhorse assets, but we felt in locations that were not necessarily high barrier to entry markets, but good economics for buyers as well and good economics for us. This is an important distinction in any part of the cycle, but perhaps even more when things have slowed down. And that's fairly normal activity. Good afternoon, everyone. PASADENA, Calif., Sept. 10, 2021 /PRNewswire/ --Alexandria Real Estate Equities, Inc. (NYSE: ARE), an urban office REIT and the first, longest-tenured and pioneering owner, operator and developeruniquely focused on collaborative life science, agtech and technology campuses in AAA innovation cluster locations, today announced that its executive chairman and founder, Joel S. Marcus, was honored last evening for Distinction in Civic Engagement and Renewal by the National September 11 Memorial & Museum during its Benefit Broadcast commemorating 20 years since 9/11. In addition to exploring potential new geographic markets, Alexandria is also staying on top of innovations in the life science industry through Alexandria Venture Investments, a venture capital platform Marcus created in 1996 that invests directly in the companies it serves. Alexandria Real Estate Equities, Inc. Executive Chairman and Joel S. Marcus, founder of Alexandria Real Estate Equities Inc. Pat Greenhouse/Globe Staff/File/2014/Globe Staff Joel S. Marcus, the real estate tycoon display: none; And obesity is estimated to account for over $480 billion in direct health care costs in the US with an additional $1.2 trillion in indirect costs due to lost economic productivity. The REIT also signed a 334,00-square-foot lease with Eli Lilly and Co. for the development of Lillys new state-of-the-art Institute for Genetic Medicine at 15 Necco Street in the REITs Seaport Innovation District submarket ofGreater Boston. We encourage everyone to be super entrepreneurial and not think like they work in a structured corporation. Our disciplined core focus is our patented and trademark lab space. Environmental, Social and Governance (ESG), HVAC (Heating, Ventilation and Air-Conditioning), Machine Tools, Metalworking and Metallurgy, Aboriginal, First Nations & Native American, Alexandria Real Estate Equities, Inc. Reports: 1Q23 Net Income per Share - Diluted of $0.44; and 1Q23 FFO per Share - Diluted, As Adjusted, of $2.19, Alexandria Real Estate Equities, Inc. Named One of Most Trustworthy Companies in America by Newsweek. To see all exchange delays and terms of use please see Barchart's disclaimer. Mr. Marcus co-founded Alexandria in 1994 as a garage startup with $19 million in Series A capital and, as Chief Executive Officer from March 1997 to April 2018, has led its growth into an S&P 500 company with an approximately $18 billion total market capitalization and a total shareholder return of approximately 1,300% since the companys IPO in 1997. I mean if you look at the tenant base and where we, again, how they went through each of the segment or a number of the segments, and I think you could always say to me, the privates are in pretty good shape because they're not exposed to the public markets, and they generally assuming we've underwritten them well, and we have. Well, wait a second, the $4.2 million is in rental properties today, it's in operations, Tony. No, that's great. Alexandria is definitely not a health care service facilities company, nor a generic office company. Our client tenants continued very timely payment of rent year-to-date through April. As noted in our press release, we were pleased to transfer an 18% interest in our current JV at 15 Necco, which we control and owned 90% prior to the sale. So its more general TIs, kind of, renovation costs that aren't part of development and redevelopment that we need to scrutinize in our business. Alexandria Real Estate Equities, Inc. (NYSE:ARE) Q1 2023 Results Conference Call April 25, 2023 3:00 PM ETCompany Participants. [3], As of December 31, 2022, the company owned or had investments in 41.7 million square feet of operating properties in addition to properties under construction. After commenting on construction costs for the past two years, I can still say they remain volatile but are on their way to stabilizing. Alexandria has played a critical role in the evolution of the life science industry over the last three decades by creating and growing the ecosystems and clusters that ignite and accelerate the world's leading innovators in their pursuit to advanced human health, which is our solid mission. Please refer to Footnote one on page 26 of our supplemental package for more information. Moderna continues to highlight the potential of novel platforms to deliver innovative new medicines to patients. Briefly on external growth, we have $610 million of incremental net operating income from our pipeline of 6.7 million square feet that is 74% leased, approximately 30% of this NOI will commence in the remaining three quarters of 2023, about 40% will commence in 2024, about 26% in 2025 and the remaining 4% thereafter. Thank you. at I know there's a few data sources out there saying that developers are still pursuing life science projects, specifically in Boston, I mean, would you agree with that statement? If you look at Hallie indicated, if you look at the tenant collections by segment, they're 99% to 100%. Please go ahead. We've had very solid leasing with the highest-ever rental rate increase, and we've had continuing strong operating and EBITDA margins. Identify stocks that meet your criteria using seven unique stock screeners. Annual NOI for these deliveries totals $23 million, and the initial stabilized yield is strong at 7.3%. We believe our unique business model and diligent underwriting ensure a high-quality and diverse tenant base that results in higher occupancy levels, longer lease terms, higher rental income, higher returns and greater long-term asset value. So operator, can we go to questions, please? Alexandrias accomplishments havent gone unnoticed. Joel Marcus, who lives in Beverly Hills, Calif., is executive chairman and co-founder of the Pasadena-based firm. I mean what's the maximum you think you could do on that number, on that line item? So, we are able to pick up some improvement to offset those. Founded in 1994, Alexandria pioneered this niche and has since established a significant market presence in key locations, including Greater Boston, the San Francisco Bay Area, New York City, San Diego, Seattle, Maryland and Research Triangle. 90% of our top 20 tenants are investment-grade rated or large-cap publicly traded companies and we highlighted continued strength of timely payments of rent from client tenants at 99.9% of rent that was due in the first quarter really reflects the strength of our high-quality client tenants, important tenant relationships and the high-quality underwriting from our research team. I said, Well, in 10 or 15 years, maybe we could be a $1 billion company. And lo and behold, we passed $44 billion in enterprise value at the end of 2021., In May, the company celebrated the 25th anniversary of its IPO. Some of which use SVB, but many of which did not or had multiple banking relationships. With the deep tenant base, relationships across every facet of the industry, and the highest quality space in operations, we can get ahead of potential tenant challenges to backfill and further optimize our tenant base. The next question comes from Rich Anderson with SMBC. For instance, in New York City, were a founding supporter of Computer Science for All. These real estate companies have to meet a number of requirements to qualify as REITs. WebJoel S. Marcus Executive Chairman & Founder Alexandria Real Estate Equities, Inc./Alexandria Venture Investments Joel S. Marcus is the Executive Chairman and Founder of Alexandria Real Estate Equities, Inc. (NYSE:ARE), an urban office REIT uniquely focused on collaborative life science and technology campuses in AAA I mean we look at qualifying activities carefully across all of our projects that are undergoing construction activities and capped interest and shut them down accordingly. Is it difficult to make long-term investments with the short-term, quarter-to-quarter pressure for results? I saw that I guess in the last supplemental, you talked about sort of dealing with 1,000 tenants. So we're giving away not too much upside by selling part of it, right? Thank you. Joel S. Marcus - Foundation for the National Institutes of WebJoel Marcus is professor of New Testament and Christian origins at Duke Divinity School. So -- what you're really focused on though in your question is a spend outside of that, which goes to quite a bit of activity, site work, advancing site work as well as entitlements. Accordingly, we're tracking direct vacancy in Greater Boston to be 2.8%. Yes, got it. Rich, it's Dean Shigenaga here. Right, right. That's a hard question to answer because it's pretty -- would be pretty granular for me to understand when I'm looking at leasing reports remembering what is expiring today versus in the future. For example, Alexandria signed a massive, 462,000-square-foot lease with vaccine-maker Moderna at its Alexandria Center at One Kendall Square mega campus in Cambridge, Massachusetts. There's no significant cash flows from assets that are sitting in the pipeline. That's helpful. In 1996, Mr. Marcus founded the companys venture capital arm, Alexandria Venture Investments, to provide strategic investment capital to innovative life science and technology entities developing breakthrough therapies and technologies. It will be ultra-efficient, minimizing its carbon footprint and harnessing geothermal energy and renewable electricity, which is really a game-changer, Marcus says. What we are seeing is in areas outside of our core submarkets where we don't own product, there are vacant buildings sitting there. Please go ahead. We have brought the mission-critical real estate infrastructure of the life science industry and integrated it with an unparalleled and world-class 24/7 operational excellence service component aimed to protect the hundreds of billions of dollars of leading-edge science, which is conducted 24/7 within our asset base. Joel Marcus Net Worth (2023) | wallmine Now turning to outstanding financial and operating results, we had really strong growth of $342.9 million or up 13.9% in total revenues for the first quarter annualized in comparison to the first quarter of 2022. Yes, it's somewhere around -- I think last quarter, it was somewhere around 27%. [1], In 1993, one of the partners of Jacobs Engineering Group, Jerry M. Sudarsky, was presented with a Business Plan written by Kendell R. Lang titled BioProperties Management Group, Inc., which was a plan to form a REIT dedicated to funding biotech properties. Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world. And that's kind of the critical message. Our team made excellent progress on our dispositions and sales of partial interest only four months into 2023. Alexandria Reports Higher Revenues But Pauses Some Projects The life sciences REIT raised rents 48 percent the highest quarterly rate growth in company Thanks. China is the dominant force they bought a number of large companies and theyre tying up all kinds of agricultural sites around the world. We focus primarily on high barrier to entry markets and brand mega-campus offerings in those AAA high barrier to entry market locations and operational excellence enables us to continually mine our vast and deep tenant base to drive our leasing activity, which will likely lessen the impact of generic supply. So put off a piece of the portfolio makes sense. The 1.2 million square feet leased in the first quarter is above our five-year pre-2021 average and is the 12th consecutive quarter with leasing volume above one million square feet. But I believe our early renewal statistics have been fairly strong recently. So, the $4.2 million does have some meaningful NOI associated with it. After serious contemplation, I decided that, if I was going to make it different in the world, this was a heck of an opportunity to do it. Well, if you can't look at the Edison, how it works and so forth, you can't underwrite the tenant. Early-stage start-ups work within a very tightened community and many used SVB because that's what everyone else used, not necessarily because there were no other options. Meanwhile, both labor and material costs have increased, Marcus says, but the biggest wildcard has been the supply chains throughout the world. And is there any read-through to other recent acquisitions, Greater Boston like Gatehouse Drive or presidential way? We updated our underlying guidance assumptions for 2023. An Interview with Joel S. Marcus, Now, the model that they have all adopted is based on our cluster model. And yes, we have liquidity, and I'm not too concerned about that at this point. Its difficult for other clusters to become mainstream and grow, because its hard to attract the four key elements: location, innovation, talent, and capital, he explains. So, Hallie? Alexandrias top-line revenue is up almost 14 percent, funds from operations per share are also up 7 percent, and the company executed strong leasing performance. Well, I think the way -- and I'll have Peter certainly and Dan may want to comment as well. The 71,000 rentable square foot building is vacant and is classified in operating properties. Launching the niche was the first step. Biotech is also not reliant on venture debt to the same extent as the tech industry. 1 for 4 weeks, First Republic in limbo as US regulators juggle bank's fate, Alibaba's Jack Ma turns up in Japan as college professor, On May Day, workers rally for better labor conditions, 'Waste of time': Community college transfers derail students. We have found that technology companies are not collaborative because they dont want other companies taking their technology or poaching their people. Marcus Weve got a built-in demand driver by our own clients, which is very unusual.. But at what point does it become too much? Joel Marcus Alexandria This page highlights square footage of our operating, but most importantly, the different categories of our pipeline, everything from construction to the future. For decades, Alexandria has been a leader in building sustainable campuses. We continue to refine our plan for 2024 because as I mentioned earlier, the $610 million of pipe, that pipeline does not require much more equity capital at stabilization because we have so much already in CIP, which the incremental EBITDA will allow us to debt fund leverage neutral, the wide majority of the incremental capital for that pipeline. View the latest news, buy/sell ratings, SEC filings and insider transactions for your stocks. And I appreciate the color that you guys have provided thus far on sort of demand and the normalization on that front. Thanks. Its not hard to do it because were uniquely focused. After over 25 years in the industry, our various executives have an amazing network, which we have developed through our summits and our real estate, as well as through our venture investments. Alexandria Real Estate Equities, Inc. pioneered the life science realestate niche and continues to break new ground in the sector.