By Craig Knox
The adage “timing is everything” couldn’t more accurately describe a recent Hughes Marino transaction success, coupled with some creative and innovative thinking to achieve an outstanding outcome for two of our clients who were in need of new space.
The deal involved OncoSec Medical Incorporated and Vividion Therapeutics, Inc., both biotechnology pioneers headquartered in the Greater San Diego region.
As with many commercial transactions, the numbers often don’t tell the full story. On the surface each company’s requirements were straightforward: Vividion needed to expand to a larger scale from their existing 12,500 square foot space, while OncoSec looked to operate in a consolidated footprint, approximately a third of the size of their current 34,000 square foot building. At many brokerage firms, an easy solution would rest in a brief inspection of market inventory to satisfy the company’s objectives. However, we viewed this opportunity as a strategic way to execute a master deal for both clients, and the outcome was as rewarding as it was complex.
With Senior Vice President Shane Poppen leading OncoSec’s search, and myself handling Vividion’s route, we saw a unique circumstance to undertake a bold swap of space between the two biotech companies. Integral to this possibility was timing, and recognizing what other brokerage companies might not. To have a pair of firms need each other’s space considerations, provided a tremendous opening for all parties, and because of our market intelligence and representing such a depth and breadth of businesses, Shane and I knew we needed to get everyone in a room and talk the scenario through.
The solution required a resourceful approach and the backing of the property owner, Alexandria Real Estate Equities, the life science and technology S&P real estate trust, which Hughes Marino has a great working relationship with. While there is a mistaken belief in the market that because of our tenant only focus, an adversarial tenor exists with owners, however that couldn’t be farther from the truth. We have an extremely positive working association with owners, because we drive so much traffic to their asset portfolios. And in this case, the Alexandria team was instrumental in completing this deal.
The tool for the transaction’s completion was an intelligently crafted lease assignment from OncoSec to Vividion, transferring their remaining lease rights on the 34,000 square feet, and a sub-lease to OncoSec for Vividion’s 12,500 square foot space. “Moving, whether it be an office or home, is a disruptive process,” says Daniel J. O’Connor, Chief Executive Officer of OncoSec. “The professionalism of the Hughes Marino team removed a lot of the stress associated with such a huge undertaking.”
To add to the positive outcome, we were also able to negotiate a swap of existing systems, laboratory inventory and physical asset catalogs. Both organizations use similar equipment, so this made a great deal of sense from a financial and operational perspective.
As OncoSec and Vividion assume their new addresses, tenant improvements at Vividion’s new site will be managed by our in-house program, project and construction management team, and there will be a timeline of shared space; once again adding to the synergies of a truly remarkable deal. “On behalf of Vividion, I want to sincerely thank the Hughes Marino team for the fantastic job they have done. It could not have worked out any better,” says G. Diego Miralles, MD, Chief Executive Officer of Vividion.
This complex accomplishment was the perfect example of the results of excellent timing, strong partnerships and proactive communication, and we look forward to delivering more outstanding results in the future.
