Success Stories

Sherpa Clinical Packaging

San Diego, CA
37,593 SF SF
Cresa San Diego
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Client Objectives

Sherpa Clinical Packaging sought to own a facility rather than continuing to lease space.  This was primarily due to the opportunity to create wealth but also due to the high costs of Sherpa’s tenant improvements, as is typical with space users in life science environments.  Cresa was hired to find a replacement tenant for Sherpa’s existing space and to identify a larger building with appropriate zoning, loading, power, ceiling height, and an outdoor area for a generator.  The property had to be deliverable for purchase within a short timeframe and able to accommodate the transformation into a state-of-the-art biologics storage and packaging facility. Due to the anticipated lofty construction costs, the most critical item to the entire transaction was building price.

Cresa Team Members

Results

Cresa worked diligently to evaluate all opportunities, both on and off-market, with supply of suitable product very low.  Cresa identified several properties, one of which had recently been reduced to shell by the building owner.  Cresa learned the owner planned to sell the property as quickly as possible in order to use the proceeds to fund other projects.  Cresa negotiated a purchase price that was approximately 60% of replacement cost and managed the escrow for approximately 75 days until close.  Cresa also referred Sherpa an SBA lender that funded the purchase price as well as the specialized improvements.  Subsequently, Cresa’s Project Management team was hired to manage all aspects of construction and to ensure that Sherpa’s retrofit money was spent wisely.  The new environment includes shipping/receiving, cleanrooms, labs, cold rooms and corporate office space. 

In order for Sherpa to avoid paying for both facilities after relocating, Cresa also needed to locate a replacement tenant for Sherpa’s existing facility.  Cresa quickly identified two likely candidates in the immediate area and negotiated with both companies simultaneously.  An agreement that provided for Sherpa to terminate early with no penalty was eventually reached and consented to by Sherpa’s landlord.  As part of the termination agreement that Cresa negotiated, the incoming replacement user reimbursed Sherpa the cost to have three cold rooms disassembled and relocated to Sherpa’s new property.

Sherpa no longer pays rent; instead, it pays debt service for a modern, secondary packaging facility.  Most importantly, Sherpa is now able to satisfy the packaging and storage demand in San Diego’s life science community.

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