In Conversation w/ Matthew Gardner, Head of Life Sciences, Americas, CBRE @ Philly Builds Bio+

BioBuzz's CEO, Chris Frew, interviews Matthew Gardner, Head of Life Sciences at CBRE, at the Philly Builds Bio 3rd Annual Symposium for Life Science Innovation and Development. Gardner discusses his extensive experience in the life sciences sector and his role in advising clients on real estate needs, with insights into his previous leadership roles and contributions to the industry.
Chris Frew [00:00:06]:
My name is Chris Frew, CEO of BioBuzz Networks. And we're here today at the third annual Philly Builds Bio Life Science Symposium here in the heart of the city where we're gathering with over 100 attendees and dozens of speakers who came together to talk about life science innovation and all the amazing things happening here in Philadelphia. I'm very honored today to be joined by Matt Gardner. Matt, thank you for joining me.
Matthew Gardner [00:00:27]:
Thanks, Chris. Happy to be here.
Chris Frew [00:00:29]:
Terrific. Why don't we start off. Do you mind giving a quick introduction, to yourself and your organization?
Matthew Gardner [00:00:33]:
Sure. So my name is Matt Gardner. I'm the head of Life Sciences in the Americas for cbre. It's a large network globally between Americas, EMEA and APAC that serves life science clients on both the investor side in lab and manufacturing, real estate, as well as the user side. We also have a. A very deep set of services we provide to users in the space that will outsource everything from building management to engineering to building equipment. So all those services kind of comprehensively available at cbre.
Chris Frew [00:01:08]:
That's terrific. Well, I'm excited to have you here today with the global perspective that you have. But the event is Philly Builds Boto. So we are here to talk about Philly. Why is this an important event that you're participating in?
Matthew Gardner [00:01:21]:
Well, I think, you know, events like this in every one of the main biotech clusters are really important touchstones to make sure we see how everybody's holding up, how the ecosystem is faring, what kind of health and vitality we see in the startup and venture capital spaces related to giving birth to new ideas and delivering them to market. So Philly Builds Bio is one of those that combines that set of issues with how the real estate ecosystem is connecting to it. And it's a great way to just make sure that we keep an eye on the vitality and the. Let me use the word vibrance in that system and making sure it's humming.
Chris Frew [00:01:58]:
I like it. I like it. We could also say buzzing.
Matthew Gardner [00:02:01]:
Oh yeah, that's handy.
Chris Frew [00:02:04]:
So maybe could you talk about what that looks like for Philly? Like what are some of the things in the Philadelphia's market that kind of stand out that you maybe hear from people that are interested in kind of opening up in a new, new area?
Matthew Gardner [00:02:18]:
Yeah, I would say globally, Philly is kind of known for two things primarily. One is that it's one of the original locations of the pharma industry. And so you can go back 150 years and find pharma Companies founded between here and oddly enough, Brooklyn that were the first class really of pharma in the US and so it's been the traditional home of quite a few of those companies. Some of them have disappeared by mergers and some of them have been acquired by Philly headquartered companies. And so it's always been one of the anchors for over a century. And that's to its good fortune. It's got the management talent, the capital and the depth of knowledge and things like product and commercialization and regulatory affairs and the kinds of things that small biotechs need. More recently, since the 1990s, it's really been the headquarters of cell and gene therapy. And so it's in that vein that we see more recent activity, a whole new class of drugs, hundreds of them that are coming along providing cures. And so it really, you know, any one of those kind of leaps in science takes 10, 20 years to develop. We got gene therapy wrong a little bit at the beginning. Same thing happened with monoclonal antibodies. It took 20 years to figure that stuff out. Science is hard, clinical trials are brutal. But we're coming through that now with the very beginning of a wave of products and cell and gene that will be lots of treatments and cures for patients on the way. So Philly's headquarters for that. It's been a great benefit to the community here to see that science or originate from here.
Chris Frew [00:03:47]:
And that's, that's great. Yeah, we've seen, I think it's good to hear that there were just the beginning of this wave because we've seen it's been a pretty busy 2024 fresh approvals. Something that you mentioned is interesting. So not every ecosystem has a combination of pharma and bio in it. How unique is that and how valuable is that for like the bio innovation ecosystem that is emerging?
Matthew Gardner [00:04:11]:
Yeah, you would have said, I think in the 1990s and into the early 2000s that the separation was that the large molecule and protein space was reserved for bio and the small molecule space was exclusive domain of pharma. That's all been merged away. 3, 4 cycles of MNA activity. Into the mid 2000s that difference was gone. And everyone has all of it now. So if you look at the pipeline of any mature 51 00-year-old, one of those titans in the industry, they're going to have all the above. So there's I think really very little difference other than the roots. And so if you look at, I used the example earlier in the program here at Philly builds bio that to me, Philadelphia resembles a little bit of the sort of anti San Diego in the sense that pharma started the ecosystem here. It didn't really have a biotech ecosystem until many years later. San Diego started as pure biotech and became pharma through acquisition several generations into JJ and Pfizer acquiring companies there. So they're very much opposite or contrasting pictures of the ecosystem being built by risk takers 100 years apart. And so I think Philly is very unique in having an unbelievably large mature army of management talent and you know, more recent biotech that fills in the picture.
Chris Frew [00:05:33]:
Yeah, that's great. And for, for drugs really to make it to market, it's that management talent that you really need and you know, complementary. Philly has tremendous academic and research talent and again, some of the innovations coming out of here. But, but is that management talent that enables the product hit the market?
Matthew Gardner [00:05:51]:
That's right. So you know, any sort of pre product, pre revenue biotech in that toughest phase of high failure rates in biotech is going to go through that stretch of time where it's thinking about build, buy or partner for its lead products. Many of those companies are not going to take their own first products to market. They're going to partner them. When you have the kind of management talent that you have here from all of that sort of depth of pharma experience, it's got an enormous advantage in regulatory affairs and commercial launch sales organizations, production and worldwide supply chain in the industry. So regardless of whether you're making an API for a chemical compound or a biologic, you know, the understanding of how the FDA works and how products are launched and supported in whatever medical space and whatever indications you're going to be in. The management talent generally speaking, has been here for decades. And so we're four or five generations into that here in a way that's impossible to replace by more recent sort of biotech clusters.
Chris Frew [00:06:53]:
Generally. It'll take generations.
Matthew Gardner [00:06:55]:
Yes.
Chris Frew [00:06:55]:
Yeah. Well, it's no, you know, no secret, it's been a tough couple of years in this, in this industry. I wonder if could you give your perspective on kind of where we are with the life science real estate market right now and maybe do you have any forecast for, you know, what's to come?
Matthew Gardner [00:07:12]:
Yeah, thanks, Chris. I think it certainly has been a down cycle since I would say Q1 of 2022. If we look back, I think the history will show that the peak was late 2021. Probably lots of startup CEOs wish they had taken the Price they were being offered in 4Q21. It was gone less than six months later. I think now we've seen that we went through an incredible bull run the industry's never before seen. So something like a seven year run from 2015 to 2021 of continued upswing in new investment, new capital sources coming to the industry for the first time, leading to an investment in new science that the industry generally speaking is still carrying. And that's really where we see the most important fundamental to keep an eye on. That's what sort of keeps us an even keel even when we're sleepless at night. So I think what's so exciting about that long wave is that it's led to generational new science. Some of it has gone through a real rough patch here these two years but we look ahead at, you know, this short term adjustment to a little bit of over delivery of new space in the short term. But in the long run that science is mostly being carried. If you look at overall R and D headcount across the industry over our overall R and D investing across the whole industry, it's staying up, it's holding at that new level. So we've reached new heights here in that amount of science being carried forward. That's why we sort of look at this as an adjustment. We'll get through this as we have three or four cycles previously. If you've been around the industry long enough to have lived through 1999 or 2007 or any number of those waves that we went through, you know, we come through it. I think what we expect though is it'll take probably until Q4 of 2025 to get through this absorption cycle and we'll begin to see the next round of new investments in campus developments and another round of a generational form of startups, probably late 25 and into 26.
Chris Frew [00:09:12]:
That's great. Well, I think, you know, I can hang on that long. So I think that's, it's good to know that I've got about a year, year and a quarter to hang, I'd.
Matthew Gardner [00:09:20]:
Say Chris, in biotech one years, it's not very long, very long at all.
Chris Frew [00:09:26]:
Yeah, that's great. So if I could just recap. So it sounds like there seems to be a steady state in funding and you know, the kind of where the capacity is right now. But you're bullish on the fact that there's just seven year bull run of, of innovation and almost like a pent up or a bench of new development that have the potential to meet, come out to market.
Matthew Gardner [00:09:50]:
That's right. And obviously the capital market's been frozen. So we look at the, you know, roughly $5 trillion in capital is sitting on the sidelines. A little more than that right now. Some of that is beginning to come back into the field. We saw an uptick in early stage investing late last year. I think all those things are the right kind of signals to tell us the science is going to carry. Some of it will get consolidated, and that's natural in our industry. It's always been the case. But we have lots of reasons to stay optimistic about where the science is headed.
Chris Frew [00:10:18]:
That's great. Well, I can't think of a better way to wrap things up than with an outlook of optimism. Here from Matt at crb. Thank you for taking the time to share with us today and being part of Philly Builds Bio.
Matthew Gardner [00:10:30]:
Thanks, Chris. Thanks for being here.
Chris Frew [00:10:33]:
My name is Chris Frew, CEO of BioBuzz Networks. We're here recording live at Philly Builds Bio.
Matthew Gardner [00:10:38]:
Thank you.