Big Sky Medical Expands in New Jersey

Spectra Labs. Image courtesy of CBRE

Big Sky Medical has acquired the Spectra Labs building, a 204,500-square-foot office/life science facility in Rockleigh, N.J. The investment manager purchased the asset, which is fully leased to Spectra Laboratories, from Spruce Healthcare Group for an undisclosed amount.

A CBRE U.S. Healthcare and Life Sciences Capital Markets team comprising Lee Asher, Jordan Selbiger, Cole Reethof, Josiah Gunter, Zack Holderman, Jeremy Neuer and Jeffrey Dunne served as the exclusive advisor to the seller, and it was a déjà vu experience for some involved. A few of the CBRE team members had represented Marcus Partners when it sold Spectra Labs to Charter Realty Group, a related entity of Spruce Healthcare Group, for $40 million in a 1031 exchange in 2016.

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Located on nearly 7 acres at the midpoint of the Boston-to-Washington, D.C., corridor, Spectra Labs sits about 25 miles from New York City in Bergen County, N.J. The two-story building welcomed its first tenant in 1977 but has since evolved into a modern mixed-use office destination featuring 54 percent state-of-the-art lab space. In 2015, the property benefited from a two-year, $49.7 million redevelopment that increased its size to accommodate the 15-year lease expansion that Spectra Laboratories had signed in 2013.

CBRE didn’t comment on the investor competition for the asset; however, the life science sector in New Jersey is hot property due to robust demand among tenants. “New Jersey’s life science market has seen rapid growth from emerging pharmaceutical and biotechnology companies,” according to a first quarter 2022 report by Colliers. “The market for move-in-ready lab space remains tight amid the growth of small and mid-sized life science firms during the year. Despite the lack of available laboratory space in the market, the construction market has been somewhat limited by the lengthy approval process and the high cost of construction.”

Two years and counting

Big Sky launched in 2020 and has since made quite a splash. Most recently, the Dallas-based investment manager turned heads in the industry with the April 2022 announcement of the formation of a $1 billion joint venture with an off-shore institutional investor for the purpose of acquiring medical office buildings and surgery centers across the U.S. Big Sky seeded the new investment vehicle with a $400 million MOB portfolio that it had amassed over a 12-month period.

Among Big Sky’s transactions since the joint venture news emerged is the closing of the purchase of a 111,800-square-foot medical office portfolio in suburban Milwaukee and Green Bay, Wis. The company acquired the four-building collection of MOBs from Stage Equity Partners, having emerged victorious in a highly competitive process.