Healthpeak Properties, Inc. PEAK recently announced a lease amendment and extension with Amgen AMGN on the Britannia Oyster Point ("BOP") campus of the former in South San Francisco. The move marks the company’s efforts to continue its strategic relationships with existing tenants as well as address future tenants looking for space at this property.
Presently, Amgen leases spaces across the BOP campus in seven buildings. These include 1130 & 1150 Veterans Blvd, 331 & 333 Oyster Point Blvd, as well as 1100, 1120 and 1140 Veterans Blvd.
With the lease amendment, Amgen has the flexible right to carry on its occupancy at three of its currently-leased buildings through 2029. At the same time, Amgen has flexibility to end its occupancy in these buildings at prior dates, which is conditional on advance notice requirements.
Located in a thriving development area, the BOP campus has 10 buildings aggregating more than 900,000 square feet of Class-A life-sciences spaces. It is positioned directly neighboring to Healthpeak's transformative 1-million-square-foot development — The Cove at Oyster Point.
Notably, over the past years, Healthpeak has made concerted efforts to reposition its portfolio. As part of these, the company has recycled capital through non-core dispositions to its solid investment and development pipeline. The strategic expansion of its life-science and medical office building (MOB) portfolio footprint and selective buyouts of high-quality senior housing assets in high barrier-to-entry markets has renewed the company’s growth opportunities.
Increasing life expectancy of the U.S. population and bio-pharma drug development growth opportunities have boosted the institutional life-science and medical-real estate market fundamentals. Amid these, Healthpeak has adopted a cluster strategy in three premier life-science epicenters — San Diego, San Francisco and Boston — aimed at assembling assets through acquisitions, developments and redevelopments. On the back of these, the company is gaining scale and is well poised to meet the growing demand of life-science tenants.
Healthpeak currently carries a Zacks Rank #3 (Hold). In the past six months, shares of this REIT have gained 8.4%, as against its industry’s increase of 2.3%.
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Cousins Properties Incorporated’s CUZ Zacks Consensus Estimate for the current-year FFO per share moved 2.1% north to $2.96 over the past two months. Shares of this Zacks Rank #2 (Buy) company have gained 12% over the past three months.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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