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Consolidated and unconsolidated real estate joint ventures (Notes)
 12 Months Ended
Dec. 31, 2021
Equity Method Investments and Joint Ventures [Abstract]  
Consolidated and unconsolidated real estate joint ventures
From time to time, we enter into joint venture agreements through which we own a partial interest in real estate entities that own, develop, and operate real estate properties. As of December 31, 2021, our real estate joint ventures held the following properties:

PropertyMarketSubmarket
Our Ownership Interest(1)
Consolidated joint ventures(2):
50 and 60 Binney Greater BostonCambridge/Inner Suburbs34.0 %
(3)
75/125 Binney StreetGreater BostonCambridge/Inner Suburbs40.0 %
225 Binney StreetGreater BostonCambridge/Inner Suburbs30.0 %
(4)
99 Coolidge AvenueGreater BostonCambridge/Inner Suburbs75.0 %
409 and 499 Illinois StreetSan Francisco Bay AreaMission Bay25.0 %
(3)
1500 Owens StreetSan Francisco Bay AreaMission Bay25.0 %
(3)
1700 Owens StreetSan Francisco Bay AreaMission Bay25.0 %
(3)
455 Mission Bay Boulevard SouthSan Francisco Bay AreaMission Bay25.0 %
(3)
Alexandria Technology Center® – Gateway(5)
San Francisco Bay AreaSouth San Francisco49.9 %
213 East Grand AvenueSan Francisco Bay AreaSouth San Francisco30.0 %
(3)
500 Forbes BoulevardSan Francisco Bay AreaSouth San Francisco10.0 %
Alexandria Center® for Life Science – Millbrae Station
San Francisco Bay AreaSouth San Francisco40.3 %
Alexandria Point(6)
San DiegoUniversity Town Center55.0 %
5200 Illumina Way
San DiegoUniversity Town Center51.0 %
9625 Towne Centre Drive
San DiegoUniversity Town Center50.1 %
SD Tech by Alexandria(7)
San DiegoSorrento Mesa50.0 %
Pacific Technology ParkSan DiegoSorrento Mesa50.0 %
(3)
1201 and 1208 Eastlake Avenue East and 199 East Blaine Street SeattleLake Union30.0 %
400 Dexter Avenue NorthSeattleLake Union30.0 %
(3)
Unconsolidated joint ventures(2):
1655 and 1725 Third Street
San Francisco Bay AreaMission Bay10.0 %
1401/1413 Research BoulevardMarylandRockville65.0 %
(8)
1450 Research BoulevardMarylandRockville73.2 %
(9)
101 West Dickman StreetMarylandBeltsville57.9 %
(9)
(1)Refer to the table on the next page that shows the categorization of our joint ventures under the consolidation framework.
(2)In addition to the real estate joint ventures listed, various partners hold insignificant noncontrolling interests in three other consolidated joint ventures in North America and we hold an interest in one other insignificant unconsolidated real estate joint venture in North America.
(3)Refer to the “Formation of consolidated real estate joint ventures and sales of partial interest” section within this Note 4 for additional information.
(4)225 Binney Street is owned through a tenancy in common arrangement. We directly own 26.316% of the tenancy in common and a real estate joint venture owns the remaining 73.684% of the tenancy in common. We own 5% of this real estate joint venture, resulting in an aggregate ownership of 30% of this property. We determined that we are the primary beneficiary of the real estate joint venture and we consolidate this joint venture under the variable interest model.
(5)Includes 601, 611, 651, 681, 685, 701, and 751 Gateway Boulevard in our South San Francisco submarket.
(6)Includes 10210, 10260, 10290, and 10300 Campus Point Drive and 4161, 4224, and 4242 Campus Point Court in our University Town Center submarket.
(7)Includes 9605, 9645, 9675, 9685, 9725, 9735, 9808, 9855, and 9868 Scranton Road and 10055 and 10065 Barnes Canyon Road in our Sorrento Mesa submarket.
(8)Represents our ownership interest; our voting interest is limited to 50%.
(9)Represent joint ventures with local real estate operators. Each of these joint ventures operates one office property which are expected to be redeveloped into office/lab. Our investments into 101 West Dickman Street and 1450 Research Boulevard joint ventures were $8.3 million and $4.0 million, respectively. The joint ventures each have a construction loan in place which is expected to fund future redevelopment cost; therefore, we expect minimal equity contributions to be required in the future. Our partners manage the day-to-day activities that most significantly affect the economic performance of each joint venture; therefore, we account for these investments under the equity method of accounting.

Our consolidation policy is described under the “Consolidation” section in Note 2 – “Summary of significant accounting policies” to our consolidated financial statements. Consolidation accounting is highly technical, but its framework is primarily based on the controlling financial interests and benefits of the joint ventures.

We generally consolidate a joint venture that is a legal entity that we control (i.e., we have the power to direct the activities of the joint venture that most significantly affect its economic performance) through contractual rights, regardless of our ownership interest, and where we determine that we have benefits through the allocation of earnings or losses and fees paid to us that could be significant to the joint venture (the “VIE model”).
We also generally consolidate joint ventures when we have a controlling financial interest through voting rights and where our voting interest is greater than 50% (the “voting model”). Voting interest differs from ownership interest for some joint ventures.

We account for joint ventures that do not meet the consolidation criteria under the equity method of accounting by recognizing our share of income and losses.

The table below shows the categorization of our joint ventures under the consolidation framework:
Property(1)
Consolidation Model Voting InterestConsolidation AnalysisConclusion
50 and 60 Binney StreetVIE model
Not applicable under VIE modelConsolidated
75/125 Binney Street
225 Binney StreetWe have:
99 Coolidge Avenue
409 and 499 Illinois Street
1500 Owens Street(i)The power to direct the activities of the joint venture that most significantly affect its economic performance; and
1700 Owens Street
455 Mission Bay Boulevard South
Alexandria Technology Center® – Gateway
213 East Grand Avenue
500 Forbes Boulevard(ii)Benefits that can be significant to the joint venture.
Alexandria Center® for Life Science – Millbrae Station
Alexandria Point
5200 Illumina Way
Therefore, we are the primary beneficiary of each VIE
9625 Towne Centre Drive
SD Tech by Alexandria
Pacific Technology Park
1201 and 1208 Eastlake Avenue East and 199 East Blaine Street
400 Dexter Avenue North
1450 Research BoulevardWe do not control the joint venture and are therefore not the primary beneficiaryEquity method of accounting
101 West Dickman Street
1401/1413 Research BoulevardVoting modelDoes not exceed 50%Our voting interest is 50% or less
1655 and 1725 Third Street

(1)     In addition to the real estate joint ventures listed, various partners hold insignificant noncontrolling interests in three other consolidated joint ventures in North America and we hold an interest in one other insignificant unconsolidated real estate joint venture in North America.

Formation of consolidated real estate joint ventures and sales of partial interest

In each of the joint ventures described below, we are contractually responsible for activities that most significantly impact the economic performance of the joint venture. In addition, our joint venture partner(s) in each of the following joint ventures lacks kick-out rights over our role as property manager. Therefore, we determined that our joint venture partner does not have a controlling financial interest and consequently each joint venture should be accounted for as a VIE. We also determined that we are the primary beneficiary of each joint venture because we are responsible for activities that most significantly impact their economic performance, and also have the obligation to absorb losses of, or the right to receive benefits from, each joint venture that could potentially be significant to the joint venture. Accordingly, we consolidate each joint venture under the variable interest model.

Refer to the “Consolidation” section in Note 2 – “Summary of significant accounting policies” to our consolidated financial statements for additional information.
213 East Grand Avenue

In April 2021, we sold a 70% interest in our 213 East Grand Avenue property located in our South San Francisco submarket for a sales price of $301.0 million, or $1,429 per RSF. We control the newly formed real estate joint venture and therefore continue to consolidate this property. Accordingly, we accounted for the $103.7 million difference between the consideration received and the book value of the 70% interest sold as an equity transaction, with no gain or loss recognized in earnings.

400 Dexter Avenue North

In July 2021, we sold a 70% interest in our 400 Dexter Avenue North property located in our Lake Union submarket for a sales price of $254.8 million, or $1,255 per RSF. We control the newly formed real estate joint venture and therefore continue to consolidate this property. Accordingly, we accounted for the $95.5 million difference between the consideration received and the book value of the 70% interest sold as an equity transaction, with no gain or loss recognized in earnings.

9444 Waples Street and Pacific Technology Park

In August 2021, we formed a real estate joint venture in our Sorrento Mesa submarket to own and operate our recently acquired 9444 Waples Street property and a collection of five adjacent properties owned by the joint venture partner also located on Waples Street. We own a 50% interest in this joint venture and our partner owns the remaining 50% interest. Concurrently with the formation of the joint venture, we:

(i)sold to our partner a 50% interest in our recently acquired 9444 Waples Street property, aggregating 88,380 RSF, for a sales price of $11.5 million, or $260 per RSF; and
(ii)acquired from our partner a 50% interest in Pacific Technology Park, aggregating 544,352 RSF, located at 9389, 9393, 9401, 9455, and 9477 Waples Street, for a purchase price of $85.8 million.

We control the newly formed real estate joint venture and therefore continue to consolidate 9444 Waples Street and have begun consolidating the Pacific Technology Park properties owned by the joint venture. The sales price we received for our sale of the 50% interest in 9444 Waples Street approximated 50% of the value paid for the property when initially acquired during the three months ended June 30, 2021. Therefore, there was no difference between the consideration received and the book value of the 50% interest sold.

409 and 499 Illinois Street

In October 2021, an investor acquired a 75% interest in our consolidated joint venture at 409 and 499 Illinois Street located in our Mission Bay submarket, which consisted of a 35% partial interest sold by us and a 40% interest held by our previous joint venture partner, for an aggregate sales price of $495.6 million. Our portion of the sales price was $231.0 million, representing $92.4 million of consideration in excess of the book value of our 35% interest sold. Upon completion of the sale, our ownership interest in the joint venture is 25%. We control the newly formed real estate joint venture and therefore continue to consolidate these properties. Accordingly, we accounted for the difference between the consideration received and the book value of our interest sold as an equity transaction, with no gain or loss recognized in earnings.

1500 Owens Street

In October 2021, an investor acquired a 75% interest in our consolidated joint venture at 1500 Owens Street located in our Mission Bay submarket, which consisted of a 25.1% partial interest sold by us and a 49.9% interest held by our previous joint venture partner, for an aggregate sales price of $130.5 million. Our portion of the sales price was $43.7 million, representing $21.3 million of consideration in excess of the book value of our 25.1% interest sold. Upon completion of the sale, our ownership interest in the joint venture is 25%. We control the newly formed real estate joint venture and therefore continue to consolidate this property. Accordingly, we accounted for the difference between the consideration received and the book value of our interest sold as an equity transaction, with no gain or loss recognized in earnings.

50 and 60 Binney Street

In December 2021, we formed a real estate joint venture in our Cambridge submarket and sold to our joint venture partner a 66.0% interest in our 50 and 60 Binney Street properties for a sales price of $782.3 million, or $2,226 per RSF. We control the newly formed real estate joint venture and therefore continue to consolidate these properties. Accordingly, we accounted for the $457.5 million difference between the consideration received and the book value of the 66.0% interest sold as an equity transaction, with no gain or loss recognized in earnings.
1700 Owens Street and 455 Mission Bay Boulevard South

In December 2021, we formed two real estate joint ventures in our Mission Bay submarket and sold to our partner in both joint ventures a 75.0% interest in our properties at 1700 Owens Street and 455 Mission Bay Boulevard South in our Mission Bay submarket for an aggregate sales price of $381.4 million, or $1,295 per RSF. We control the newly formed real estate joint ventures and therefore continue to consolidate the properties owned by these joint ventures. Accordingly, we accounted for the $221.9 million difference between the consideration received and the aggregate book value of the 75.0% interests sold as an equity transaction, with no gain or loss recognized in earnings.

Consolidated VIEs’ balance sheet information

The table below aggregates the balance sheet information of our consolidated VIEs as of December 31, 2021 and 2020 (in thousands):
December 31,
20212020
Investments in real estate$5,014,842 $3,196,215 
Cash and cash equivalents181,074 95,565 
Other assets509,281 341,524 
Total assets$5,705,197 $3,633,304 
Secured notes payable$7,991 $— 
Other liabilities269,605 183,237 
Total liabilities277,596 183,237 
Redeemable noncontrolling interests— 1,731 
Alexandria Real Estate Equities, Inc.’s share of equity2,593,505 1,742,039 
Noncontrolling interests’ share of equity2,834,096 1,706,297 
Total liabilities and equity$5,705,197 $3,633,304 

In determining whether to aggregate the balance sheet information of consolidated VIEs, we considered the similarity of each VIE, including the primary purpose of these entities to own, manage, operate, and lease real estate properties owned by the VIEs, and the similar nature of our involvement in each VIE as a managing member. Due to the similarity of the characteristics, we present the balance sheet information of these entities on an aggregated basis. None of our consolidated VIEs’ assets have restrictions that limit their use to settle specific obligations of the VIE. There are no creditors or other partners of our consolidated VIEs that have recourse to our general credit, and our maximum exposure to our consolidated VIEs is limited to our variable interests in each VIE, except for our 99 Coolidge Avenue joint venture in which the VIE’s construction loan is guaranteed by us. For additional information, refer to Note 10 – “Secured and unsecured senior debt” to our consolidated financial statements.
Unconsolidated real estate joint ventures

Our maximum exposure to our unconsolidated VIEs is limited to our investment in each VIE. Our investments in unconsolidated real estate joint ventures, accounted for under the equity method of accounting as presented in our consolidated balance sheets of December 31, 2021 and 2020, consisted of the following (in thousands):
December 31,
Property20212020
Menlo Gateway(1)
$—$300,622
1655 and 1725 Third Street14,03414,939
1450 Research Boulevard4,455—
101 West Dickman Street8,481—
704 Quince Orchard Road—4,961
Other
11,51311,827
$38,483$332,349
(1)During the three months ended December 31, 2021, we sold our entire 49.0% equity interest in this unconsolidated real estate joint venture.

704 Quince Orchard Road

During the year ended December 31, 2021, we acquired our partner’s ownership interest in our unconsolidated real estate joint venture that holds our property located at 704 Quince Orchard Road. For additional information, refer to the “Purchase of partner’s interest in an unconsolidated real estate joint venture in March 2021” subsection of the “Acquisitions” section in Note 3 – “Investments in real estate” to our consolidated financial statements.

Menlo Gateway

In December 2021, we sold our entire 49.0% equity interest in our unconsolidated real estate joint venture at Menlo Gateway, aggregating 772,983 RSF of tech office space located in our Greater Stanford submarket of the San Francisco Bay Area for a sales price of $541.5 million, or $1,430 per RSF. We received $397.9 million in proceeds, which consisted of a sales price of $541.5 million less our share of debt held by the unconsolidated real estate joint venture assumed by the buyer, aggregating $143.6 million. In connection with the sale, we recognized a gain of $101.1 million, which is classified within gain on sales of real estate within our consolidated statements of operations for the year ended December 31, 2021.

1401/1413 Research Boulevard

In January 2015, we formed a joint venture with a local retail developer and operator by contributing a land parcel located in our Rockville submarket of Maryland. The joint venture developed a retail shopping center aggregating approximately 90,000 RSF, which was primarily funded by a construction loan that is non-recourse to us. Since its formation, we accounted for this investment under the equity method of accounting as we do not have a controlling interest.

In March 2020, as a result of the impact of the COVID-19 pandemic, we evaluated the recoverability of our investment and recognized a $7.6 million impairment charge to lower the carrying amount of our investment balance to zero and eliminated this investment from our consolidated balance sheet. We continue to hold our economic interest in this joint venture. However, as the investment balance was carried at zero dollars, we discontinued applying the equity method recognition of losses in excess of our capital commitments to the joint venture.

The equity method of accounting continues to remain suspended until a point where either (i) the joint venture accumulates operating profits in excess of losses accumulated or (ii) additional financial support is contributed by us to the joint venture.

In June 2021, as a result of improving economic conditions for this retail center, we contributed capital aggregating $578 thousand to the joint venture to become current with required capital contributions and maintain our 65.0% equity interest in this joint venture. This contribution increased our investment in the joint venture, but this was offset by the recognition of our share of operating losses of the joint venture that occurred while our equity method accounting was suspended. In June 2021, concurrently with the additional financial support contributed to the joint venture, we recognized equity in losses of unconsolidated real estate joint ventures equal to the $578 thousand, resulting in a carrying amount of our investment in the joint venture of zero dollars as of June 30, 2021.
101 West Dickman Street and 1450 Research Boulevard

In October 2021, we formed a real estate joint venture with two partners holding a 135,423 RSF property located at 101 West Dickman Street in our Maryland market, in which we acquired a 57.9% ownership interest for $8.3 million. In addition, in December 2021, we formed a real estate joint venture with a partner holding a 42,679 RSF property located at 1450 Research Boulevard in our Maryland market, in which we acquired a 73.2% ownership interest for $4.0 million.

Each of these joint ventures operates one office property which are expected to be redeveloped into office/lab. The joint ventures have construction loans in place which are expected to fund future redevelopment costs and therefore we expect minimal additional future equity contributions from us to be required.

Our joint venture partners manage the day-to-day activities that most significantly affect the economic performance of each joint venture. Therefore, we account for our investments under the equity method of accounting.

The following table presents key terms related to our unconsolidated real estate joint ventures’ secured loans as of December 31, 2021 (dollars in thousands):
Unconsolidated Joint VentureOur ShareMaturity DateStated Rate
Interest Rate(1)
Aggregate Commitment
at 100%
Debt Balance
at 100%(2)
1401/1413 Research Boulevard65.0%12/23/242.70%3.14%$28,500 $28,124 
1655 and 1725 Third Street10.0%3/10/254.50%4.57%600,000 598,657 
101 West Dickman Street57.9%11/10/26SOFR + 1.95%
(3)
2.81%26,750 9,947 
1450 Research Boulevard73.2%12/10/26SOFR + 1.95%
(3)
N/A13,000 — 
$668,250 $636,728 
(1)Includes interest expense and amortization of loan fees.
(2)Represents outstanding principal, net of unamortized deferred financing costs, as of December 31, 2021.
(3)This loan is subject to a fixed SOFR floor rate of 0.75%.