Storied Westchester Developer Sees ‘Big Future’ For Firm and County in Life Sciences Sector
John Jordan | November 15, 2019
WHITE PLAINS—Elmsford-based real estate development and investment firm Robert Martin Company LLC, which helped shape the commercial real estate market in Westchester County decades ago, now sees the growing biotechnology and life sciences sector as an avenue of growth for the firm and the county as a whole.
Speaking at the Oct. 31 meeting of the Hudson Gateway Association of Realtors’ Commercial Investment Division, Robert Martin CEO Timothy Jones discussed the mega-deal that closed in March of this year that involved the acquisition by Robert Martin of Mack-Cali Realty Corp.’s flex/industrial portfolio in Westchester and Fairfield counties for $487.5 million—the largest commercial real estate transaction in Westchester County history.
Approximately 95% of the properties acquired by Robert Martin were those that the company sold to Cali Realty in 1997. Robert Martin co-developers Martin Berger and Robert Weinberg developed most of the buildings from the 1970s through the 1990s.
Since the purchase, Jones said Robert Martin has hired approximately 20 new employees to deal with its much larger commercial, flex, residential and retail portfolio.
One key hire of late is Laurence Gottlieb, the new Director, Life Sciences and Health Technologies, who is heading RMC BIO1, which is geared to servicing the needs of the region’s life sciences/health care and biotech industries. Gottlieb, who also spoke at the CID session, is the former president and CEO of Hudson Valley Economic Development Corporation and the former head of the Westchester County Office of Economic Development.
‘Westchester Has Turned the Corner’
Jones said Westchester County’s commercial real estate market is strong and pointed to the company’s 225,000 square feet in new leases and renewals in its portfolio since its purchase of the Mack-Cali industrial/flex portfolio this past spring.
“Westchester actually turned the corner from a development standpoint a few years ago and certain markets are really strong and really make sense from an investment standpoint,” Jones said. While noting that development is still difficult in Westchester County due to the lack of available land, he praised political and business leaders for standing up against the ‘naysayers” to advance worthwhile development projects.
The county has seen significant residential development, some retail and some special purpose projects such as fitness facilities for example. He said that industrial demand in Westchester is strong, and the county would be benefitting from new industrial development ventures if the county had sufficient available land.
Jones said that its Mid-Westchester Executive Park, which is located near Regeneron Pharmaceutical’s biotech complex, will likely be the focus of the company’s push to accommodate mid-sized biotech and life science companies.
The 770,000-square-foot Mid-Westchester Executive Park is also located in a federally designated Opportunity Zone, which offers significant benefits to investors. Jones believes the Opportunity Zone designation will allow the company to convert some of the vacant existing space at the park to lab space.
Jones said that the company is committed to investing in Westchester County. “We think Westchester has a very great future, but a complicated future,” he said, noting that while demand is strong for commercial and residential space, the cost of living and doing business is high in the county. Jones stressed the county must take advantage of its strengths such as: great schools, transportation network, amenities and easy access to New York City.
The vice chairman of economic development for the Business Council of Westchester said the medical and life sciences industries will likely be key drivers for new jobs and investment in the years ahead and sees investment in those sectors “as a big future” for Robert Martin Co.
Gottlieb in his presentation to the CID stated that the biotechnology and life sciences sectors have grown considerably in a short period of time. Fledgling start-ups have been afforded incubator space at New York Medical College’s facilities in Valhalla and at Westchester County’s recently launched Element 46 incubator program that launched in June.
In late October New York Medical College’s incubator BioInc@NYMC celebrated its fifth anniversary and announced it would be nearly doubling its footprint. The expanded space will allow the New York State-designated Innovation Hot Spot to incubate up to 20 additional medical companies and provide tenants additional resources to support their growth. BioInc@NYMC previously occupied a 10,000-square-foot wing; the expansion will add an additional 9,500 square feet to the incubator. BioInc’s additional space will allow for new offices, conference rooms, shared-space desks and collaboration/event space for seminars.
Gottlieb said that the need that hopefully Robert Martin will be able to fill is for mid-sized life sciences firms that require flex, lab and office space in the 5,000-square-foot to 10,000-square-foot range. He did note however, that some firms graduating out of incubator space. do not have require contiguous lab and office space and therefore Westchester could accommodate locally-based life science companies that have their research operations elsewhere, such as in the Research Triangle in North Carolina.
Plans for 555 White Plains Road
Jones said that after some leases expire next summer, Robert Martin is exploring several capital investment scenarios at its 555 White Plains Road office building in Tarrytown. Jones said Robert Martin may look to embark on a major capital improvement effort there to upgrade the five-story, nearly 134,000-square-foot office property.
He did reveal that the company is in discussions with a tenant to lease a portion of the building and convert it to a mixed-use property.
Significant Leasing Activity Since Mack-Cali Portfolio Purchase
The company announced it had secured 250,000 square feet of new lease and renewal transactions since its mega deal with Mack-Cali this spring.
“With the rapid growth of the e-commerce and last-mile delivery, coupled with the scarcity of developable land, there is a real shortage of this type of space. Demand for flex/industrial space is very strong in the Westchester market,” said Jeremy Frank, RMC’s Vice President of Investments.
The company’s flex/industrial parks include the 1.36-million-square-foot Cross Westchester Executive Park in Elmsford; the 770,000-square-foot Mid-Westchester Executive Park in Hawthorne; the 780,000-square-foot South Westchester Executive Park in Yonkers and the 270,000-square-foot Stamford Executive Park in Fairfield County, CT.
“We’ve also been busy implementing our capital improvement plan throughout the portfolio. This has included repaving large portions of the parking lots and roadways, painting projects, roof replacements, and other enhancements. New green initiatives like LED lighting retrofits, building system upgrades, and renewable energy projects will be rolled out in the near future,” said Jeffrey Warner, Vice President of Leasing.