CapitaLand Ascendas REIT to transform San Diego office property into a life science building

The cost of the convert-to-suit exercise will be $56.4m.

CapitaLand Ascendas REIT (CLAR) will transform its office property in  Sorrento Mesa, San Diego, California to become the new global headquarters of Crinetics Pharmaceuticals, Inc.

The cost of the convert-to-suit exercise will be $56.4m. Under the lease agreement, CLAR will convert its property into a two-storey life sciences building outfitted with new mechanical, electrical and plumbing (MEP) systems, roof, windows and interior improvements, which include state-of-the-art laboratories, office and vivarium spaces.

The 94,230 sq ft property will also have solar panels and extensive indoor and outdoor spa-like amenities to improve employee well-being. CLAR plans to complete the conversion by Q423.

When completed, the conversion will enable CLAR to ascribe a higher base rent with an annual escalation of 3% and a net property income yield pick-up of approximately 9%.

CLAR added that the triple-net lease commitment of 11.5 years, with an option to extend two additional five-year terms, by Crinetics Pharmaceuticals will provide a stable income stream.