San Rafael-based BioMarin Pharmaceutical Inc. has signed an agreement to purchase the San Rafael Corporate Center for $116.5 million.
"We're committed to being in Marin County, and space here is scarce," said Debra Charlesworth, a spokeswoman for the company. "We feel it is valuable to have long-term control over the property."
The transaction is expected to be completed by Jan. 22.
In January 2012, BioMarin signed a 10-year lease to occupy 120,000 square feet at the center, moving its headquarters from Novato to downtown San Rafael. Approximately 375 BioMarin employees work out of the corporate center, Charlesworth said.
San Rafael Mayor Gary Phillips said, "It further underscores that they want to be here for a long period of time, so that sounds like good news."
In a letter to the San Rafael City Council, Willis Polite, president of Seagate Properties, the seller of the property, wrote, "The direct economic impact on the local retail stores, restaurants and service providers due to the relocation of BioMarin to downtown San Rafael has already proven to be a substantial benefit to the community."
Founded in Novato in 1997, BioMarin specializes in the development and production of "orphan drugs," or medications that treat rare diseases. In addition to its headquarters in San Rafael, it maintains manufacturing operations in Novato. Eighty percent of its 1,300 employees are based in Marin. The company reported total revenue of about $405 million during the first three quarters of 2013 and a net loss of $53 million over the same period. The company is investing heavily in research and development.
The San Rafael City Council approved the corporate center as a 406,000-square-foot project in 1998. More than 300,000 square feet of space has been built so far. Two additional structures contained in the original development agreement remain to be built: an 89,000-square-foot office building at 791 Lincoln Ave. and a parking garage at 788 Lincoln Ave.
Charlesworth said, "We are in the very initial stages of working with the city of San Rafael and the local neighborhood association about building on some of that property. We're in immediate need of additional lab space and parking."
BioMarin occupies about 40 percent of the corporate center complex. Charlesworth said BioMarin will honor the leases of the other tenants, but she wouldn't say whether BioMarin will be willing to extend those leases or grant new ones.
"We'll have to look at that when the time comes," Charlesworth said.
Seagate was initially scheduled to begin construction of the final two buildings in 2009, but the city of San Rafael granted a 60-month extension due to the recession.
Jack Wilkinson, president of the Marin Association of Realtors, said Seagate may have felt some urgency to sell the property.
He said if Seagate's permit extensions expired, "they would have had to go through the permit process again; I doubt very much they would have got the permits.
"We're in NIMBY land. Everyone wants to keep everything the way it was in 1910."
The corporate center was built on 15 acres once occupied by Pacific Gas and Electric Co. The investor-owned utility operated a coal gasification plant there until 1960. In 1985, state environmental officials placed restrictions on the site, blocking child care, health care, senior care or residential development. PG&E vacated the site in 1990.
The center was envisioned as the corporate headquarters for the Fair Isaac Corp. But in 1998 Fair Isaac announced it had other plans, and in 2000, Wilson/Equity Office, the nation's largest office building owner and manager, took over the project.
In 2005, a joint venture of real estate giants Sterling American Property and Hines purchased the center and three other Bay Area properties for $329 million. Seagate purchased the center in 2007.
Robert Eyler, CEO of the Marin Economic Forum and a professor at Sonoma State University, said BioMarin's purchase of the center may mean the company plans to make San Rafael its long-term home — "or this may simply be a way for them to diversify their assets and avoid increasing lease rates."