Case Study

Regeneron Pharmaceuticals

Life Sciences

Biopharmaceutical Company Saves Over $15 Million in Substantial Build-to-Suit Lease


Regeneron is a biopharmaceutical company that discovers, develops, and intends to commercialize therapeutic medicines for the treatment of serious medical conditions. Over the past 10 years, the firm had organically grown from a single office suite into seven separate non-contiguous spaces located throughout the Landmark complex in Tarrytown, NY. Regeneron had been attempting, for several years, to create a plan that would allow it to build or relocate to a new state-of-the-art laboratory and headquarters facility; however, the tremendous capital outlay required had been a hurdle Regeneron historically could not overcome.


Savills was faced with a significant challenge. We had to structure a transaction that would be similar in annual expense to the existing renewal terms and that would require Regeneron to utilize virtually none of its own capital. With preliminary tenant-improvement budgets approaching $250 psf, the possibility of a relocation or build-to-suit appeared remote. However, by utilizing a combination of municipal incentives, extremely efficient infrastructure, financial structuring, financing from which only a public REIT could benefit, and some extreme value engineering, we were able to produce a build-to-suit transaction that accomplished and actually exceeded all of Regeneron’s goals. In addition, we acquired favorable expansion rights for Regeneron that would allow the company to more than double in size on the same campus.


The final transaction resulted in Regeneron taking control of five of six floors in two new build-to-suit buildings with a 15-year lease. The landlord provided Regeneron with $245 psf in capital funding at a lower cost of capital than Regeneron’s own. Additionally, even though Regeneron’s credit is sub-investment grade, the firm was only required to provide three months rent as a security deposit. Finally, we secured the location of the new development to be adjacent to one of Regeneron’s existing pods of space within the old development, and as a result, Regeneron will be able utilize the most valuable part of the old installation – the Vivarium. This alone saved Regeneron $14 million in capital (the replacement cost) and was vital to keeping the overall economics in line with those of a renewal.