Tech Bros Drawn to Kilroy’s South SF Life Sciences Office

Kilroy Realty has opened the second phase of its 3-million-square-foot Oyster Point life sciences campus in South San Francisco — but it’s attracting financial and tech firms.

The Los Angeles-based real estate investment trust just completed three buildings that contain 865,000 square feet, built to house biotech firms at Kilroy Oyster Point at 384 Oyster Point Boulevard, the San Francisco Business Times reported.

Instead, tech firms and financial companies have lined up as prospective tenants of the second phase, which opened for move-in last month, according to Kilroy. Terms for prospective leases were not disclosed.

“The buildings are purpose-built life sciences — that was the original intent. That’s still our intent,” Rob Paratte, chief leasing officer for Kilroy, told the Business Times.

That comes with a big fat “but…” Expanding the scope of tenants beyond life sciences is nothing new for Kilroy.

Before life sciences firms fell into a capital slump four years ago, Kilroy leased the 656,000-square-foot first phase of its Oyster Point project to payments giant Stripe, as well as drug developer Cytokinetics.

What’s different now is a general biotech downturn while millions of square feet of biotech offices and labs opened up across the Peninsula, according to the Business Times.

The glut has put pressure on expensive biotech projects to open the door for nonbiotech users.

Angela Aman, CEO of Kilroy, attributed the non-biotech interest in Oyster Point’s second phase to its community features, as well as its furnished spec suites and fresh landscaping.

Oyster Point’s latest phase has a restaurant, a fitness center, a conference center and an amphitheater.

They have “really changed the dynamic and how that project feels,” Aman told the newspaper. “We’re seeing that result in additional tour activity and additional constructive conversations across a broad range of tenants and a broad range of sizes as well.”

Kilroy Realty, founded in 1996 by John Kilroy Jr., has a real estate portfolio of 14 million square feet, including life sciences properties in the Bay Area, Seattle and San Diego, according to its website. — Dana Bartholomew