High Rents Driving Biotech Startups Out of New York and Boston
Firms Tired of Focusing Time and Capital on Real Estate Development

Young people aren’t the only ones who can’t afford the rent in New York. Biotech firms are also leaving the Big Apple in search of affordable accommodations outside the city.

Though the city offer numerous benefits to growing companies, lab space is simply too expensive to build and operate, says Andras Forgacs, chief executive of biotech startup Modern Meadow.

“We don’t have the time and we don’t have the capital to be in the real estate development business in New York City,” he told VentureBeat. “That’s not what our investors asked for.”

Modern Meadow would have had to pay $200 million to build its own lab in New York. Instead, it found existing lab space in New Jersey.

It’s a similar story in Boston.

Triple net leases are $78.50 a square foot in Cambridge but drop to just $15 in the outer ring of Boston’s suburbs, according to brokerage firm Cushman & Wakefield.