According to CBRE, one of NYC's budding commercial property sectors - the life sciences market - hasn't lost a step during the pandemic era. Even in the face of a broader economic downturn, NYC's lab tenant demand has ramped up significantly since year-end 2019, which has coincided with improvements in nearly all of the lab sector's fundamentals.
Among the milestones reached in 2020 were the first leases signed at a pair of NYC's newest life sciences developments. Protara Therapeutics leased 10,000 sq. ft. at Cure, Deerfield Management's redevelopment of 345 Park Avenue South into a premier life sciences hub and ecosystem.
Across the East River in Long Island City, ReOpen NY completed an 18,000 sq. ft. lease at Alexandria Real Estate Equities' redevelopment of the Bindery Building.
This momentum has carried into 2021, as NYC's lab leasing activity has already reached a record high for a single year, at 257,000 sq. ft. through May 2021. This year's leasing activity has been bolstered by the Icahn School of Medicine at Mount Sinai's 165,000 sq. ft. research-focused lease at 787 Eleventh Avenue and C16 Biosciences' 19,000 sq. ft. lease at the Hudson Research Center, where the Bill Gates-backed startup will relocate from its incubator space at BioLabs New York.
The flow of venture capital (VC) funds into the NYC life sciences market has been one of the most telling indicators in recent years of the city's expanding profile as a major hub for the sector. Following a record-setting 2017, which saw NYC's life sciences funding balloon to $1.38 billion, VC funding has seen no less than $697 million raised annually, with funding reaching its second-highest total in 2020 at $942 million.
This blistering performance has only intensified further in 2021, with NYC's life sciences VC funding off to its strongest start ever. In Q1 2021, funding amassed its highest quarterly total on record, at $393 million. And with an additional $144 million raised through roughly the first two months of Q2, 2021's year-to-date total of $537 million is now 60% ahead of the prior high point set last year through the same time frame.
Just as important as the sheer dollar volume of VC funding over the past few years is the mix of firms that are raising the capital, with a clear link between those firms receiving VC funding and those who ultimately sign lab leases in NYC. Indeed, Hibercell, a startup born out of research at the Icahn School of Medicine at Mount Sinai - which has received multiple rounds of funding including a new round in 2021 - signed a lease in early 2019 at the Hudson Research Center. Volastra Therapeutics, which inked a lease in 2020 at the Mink Building, has also received multiple funding rounds. More recently, Immunai leased space at the Alexandria Center for Life Science in Q1 2021, after receiving funding in both 2020 and 2021.