Alexandria (ARE) Unveils Alexandria LaunchLabs In Cambridge

Alexandria Real Estate Equities, Inc. (NYSE:ARE) is expanding the company’s full-service life-science start-up platform, Alexandria LaunchLabs, with the opening of its first Cambridge location at the Alexandria Center in One Kendall Square (NYSE:SQ). The move comes as part of the company’s expansion efforts to bank on the life-science real estate industry’s favorable fundamentals.

Particularly, the 20,000-square-foot seed- and early-stage incubator opens with more than 10 innovative seed- and early-stage member companies. There is a high demand for this platform, as well as for its prime location in the heart of East Cambridge's Kendall Square, known as the world's most innovative square mile. This is evident from the strong pool of applicants for this facility.

The company will provide flexible, cost-effective, move-in ready and well-equipped wet laboratory and office space. Further, it would offer high-quality equipment and services, mentorship and programming, in addition to seed-capital access through Alexandria Seed Capital Platform.

Notably, with its prized site at the Alexandria Center for Life Science – New York City and Cambridge location at the Alexandria Center at One Kendall Square, the company remains well poised to provide a solid start-up platform for life-science companies. This, in turn, will spur demand for life-science space over the long run. Given the company’s expertise and robust balance-sheet capacity, it might capitalize well on the same and ride on its growth curve.

Joel S. Marcus, executive chairman and founder of Alexandria Real Estate Equities, Inc. and Alexandria Venture Investments informed, “Our unique, fully integrated Alexandria LaunchLabs platform and our Alexandria Seed Capital Platform will continue to fill the crucial role in aiding transformative seed- and early-stage companies in their efforts to develop novel, cost-effective therapies to ease human suffering."

Moreover, recently the company announced a 4.3% sequential hike in quarterly cash dividend. In November, Alexandria announced that it has commenced development of a 175,000 rentable square feet (RSF) Class A property on its Maryland campus at 9800 Medical Center Drive. The move comes as part of its effort to enhance property base in key locations.

Notably, strong fundamentals of the life-science industry are helping the company’s Class A properties in upscale locations to enjoy high occupancy. Its effort to improve credit profile is also encouraging. Nonetheless, the company’s huge development pipeline exposes it to the risk of rising construction costs.

Alexandria currently carries a Zacks Rank #3 (Hold). Over the past month, shares of the company have inched up 0.3%, outperforming the industry’s 0.8% decline during the same time period.

Stocks to Consider

Better- ranked stocks from the real-estate space include Boston Properties, Inc. (NYSE:BXP) , PS Business Parks, Inc. (NYSE:PSB) and Outfront Media Inc. (NYSE:OUT) . Each of these stocks carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Boston Properties’ FFO per share estimates for 2018 has been revised marginally upward to $6.39 in the last 30 days.

PS Business Parks’ Zacks Consensus Estimate for 2018 FFO per share moved 1.3% north to $6.45 in the past two months.

Outfront Media’s FFO per share estimates for the current year has been revised 2% upward to $2.09 in two months’ time.

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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