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Alexandria (ARE) Transfers Partial Interest in 15 Necco Street
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Alexandria Real Estate Equities, Inc. (ARE - Free Report) recently transferred a partial interest in 15 Necco Street, a 345,995 rentable square feet (RSF) Class A property presently under construction, to a U.S. affiliate of Mori Trust Co., Ltd. The transfer was done through an affiliate.
The proceeds from the transaction will be used to fund the development of the property located in the Seaport Innovation District submarket of Greater Boston. The delivery is anticipated to take place in late 2023. This highlights Alexandria’s prudent capital-management practices.
Eli Lilly and Company (LLY - Free Report) , one of Alexandria’s longtime tenants, had chosen this state-of-the-art facility for its Lilly Institute for Genetic Medicine. The institute will leverage promising RNA- and DNA-based technologies to develop therapies with the potential to treat or prevent diseases in a way that is either challenging or not possible with traditional medicines.
Strategically located adjacent to Cambridge's Kendall Square, 15 Necco Street provides convenient access to major transportation hubs. Developed in partnership with National Development, this amenity-rich building with a uniquely inspiring design and building-activation program is likely to help Eli Lilly attract and retain people from Greater Boston's deep life science talent pool.
Per Hunter L. Kass, executive vice president and regional market director of Greater Boston at Alexandria, “Our dominant one-of-a-kind platform, in combination with a scarcity of high-quality life science real estate assets, continues to drive demand for investment opportunities arising from our value harvesting and capital recycling strategies.”
Moreover, the building leverages geothermal energy to reduce fossil fuel use and utilizes 100% renewable electricity generated on and off-site. This is an example of Alexandria's efforts to mitigate greenhouse gas emissions.
Further, keeping in mind the overall physical and mental well-being of its occupants, the transformative facility will include several wellness features. It is also targeting LEED Gold Core & Shell, Fitwel Life Science and WiredScore Platinum certifications.
Alexandria’s Class A properties are situated in North America's AAA innovation cluster locations, with significant market presence in Greater Boston, San Francisco Bay Area, New York City, San Diego, Seattle, Maryland and Research Triangle. The advantageous locations of its properties have been driving demand, resulting in high occupancy levels.
Amid the growing need for drug research and innovation, the company has been experiencing healthy leasing activity on solid demand for its high-quality office/laboratory space. This has been aiding the company’s rental rate growth. In 2022, it registered rental rate growth of 31% and 22.1% (cash basis).
Also, Alexandria has been focusing on the acquisition, development and redevelopment of new Class A properties in AAA locations. In 2022, it completed acquisitions in its key life-science cluster submarkets totaling 10.2 million square feet (SF) for $2.8 billion. Its encouraging development pipeline bodes well for its long-term growth.
With a solid balance-sheet position and ample financial flexibility, ARE is well-positioned to capitalize on long-term growth opportunities.
Shares of this Zacks Rank #3 (Hold) company have lost 7.6% in the past six months against its industry’s growth of 9%.
Image: Bigstock
Alexandria (ARE) Transfers Partial Interest in 15 Necco Street
Alexandria Real Estate Equities, Inc. (ARE - Free Report) recently transferred a partial interest in 15 Necco Street, a 345,995 rentable square feet (RSF) Class A property presently under construction, to a U.S. affiliate of Mori Trust Co., Ltd. The transfer was done through an affiliate.
The proceeds from the transaction will be used to fund the development of the property located in the Seaport Innovation District submarket of Greater Boston. The delivery is anticipated to take place in late 2023. This highlights Alexandria’s prudent capital-management practices.
Eli Lilly and Company (LLY - Free Report) , one of Alexandria’s longtime tenants, had chosen this state-of-the-art facility for its Lilly Institute for Genetic Medicine. The institute will leverage promising RNA- and DNA-based technologies to develop therapies with the potential to treat or prevent diseases in a way that is either challenging or not possible with traditional medicines.
Strategically located adjacent to Cambridge's Kendall Square, 15 Necco Street provides convenient access to major transportation hubs. Developed in partnership with National Development, this amenity-rich building with a uniquely inspiring design and building-activation program is likely to help Eli Lilly attract and retain people from Greater Boston's deep life science talent pool.
Per Hunter L. Kass, executive vice president and regional market director of Greater Boston at Alexandria, “Our dominant one-of-a-kind platform, in combination with a scarcity of high-quality life science real estate assets, continues to drive demand for investment opportunities arising from our value harvesting and capital recycling strategies.”
Moreover, the building leverages geothermal energy to reduce fossil fuel use and utilizes 100% renewable electricity generated on and off-site. This is an example of Alexandria's efforts to mitigate greenhouse gas emissions.
Further, keeping in mind the overall physical and mental well-being of its occupants, the transformative facility will include several wellness features. It is also targeting LEED Gold Core & Shell, Fitwel Life Science and WiredScore Platinum certifications.
Alexandria’s Class A properties are situated in North America's AAA innovation cluster locations, with significant market presence in Greater Boston, San Francisco Bay Area, New York City, San Diego, Seattle, Maryland and Research Triangle. The advantageous locations of its properties have been driving demand, resulting in high occupancy levels.
Amid the growing need for drug research and innovation, the company has been experiencing healthy leasing activity on solid demand for its high-quality office/laboratory space. This has been aiding the company’s rental rate growth. In 2022, it registered rental rate growth of 31% and 22.1% (cash basis).
Also, Alexandria has been focusing on the acquisition, development and redevelopment of new Class A properties in AAA locations. In 2022, it completed acquisitions in its key life-science cluster submarkets totaling 10.2 million square feet (SF) for $2.8 billion. Its encouraging development pipeline bodes well for its long-term growth.
With a solid balance-sheet position and ample financial flexibility, ARE is well-positioned to capitalize on long-term growth opportunities.
Shares of this Zacks Rank #3 (Hold) company have lost 7.6% in the past six months against its industry’s growth of 9%.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks from the REIT sector are VICI Properties (VICI - Free Report) and Terreno Realty (TRNO - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for VICI Properties’ current-year funds from operations (FFO) per share is pegged at $2.12.
The Zacks Consensus Estimate for Terreno Realty’s 2023 FFO per share is pegged at $2.17.
Note: Anything related to earnings presented in this write-up represents FFO — a widely used metric to gauge the performance of REITs.