Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): July 13, 2023

ALEXANDRIA REAL ESTATE EQUITIES, INC.

(Exact name of registrant as specified in its charter)

Maryland

1-12993

95-4502084

(State or other jurisdiction of
incorporation)

(Commission File Number)

(I.R.S. Employer Identification No.)

26 North Euclid Avenue, Pasadena, California 91101

(Address of principal executive offices) (Zip code)

Registrant’s telephone number, including area code: (626) 578-0777

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4 (c) under the Exchange Act (17 CFR 240.13e-4 (c))

Securities registered pursuant to Section 12(b) of the Exchange Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $.01 par value per share	ARE	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02 Results of Operations and Financial Condition.

Alexandria Real Estate Equities, Inc., a Maryland corporation (the “Company”), is furnishing with this report as Exhibit 99.1 certain select preliminary unaudited operating results for the three months and six months ended June 30, 2023, together with key select updates to the Company’s 2023 guidance. The financial results presented in Exhibit 99.1 are preliminary and subject to normal quarterly closing processes and accounting review. As such, the preliminary financial results for the periods referenced above reflect management’s preliminary estimate with respect to such information based on preliminary unaudited information available as of the date hereof and may vary from the Company’s actual financial results for these periods which will be included in the Company’s Form 10-Q for the quarter ended June 30, 2023. As previously announced, the Company is scheduled to report its second quarter 2023 operating and financial results on Monday, July 24, 2023.

Item 7.01 Regulation FD Disclosure

On July 13, 2023, the Company issued a statement regarding certain aspects of its business and prospects, attached hereto as Exhibit 99.2.

The Company is also furnishing with this report a summary of its Class A/A+ development and redevelopment properties: current projects, and dispositions and sales of partial interests as of June 30, 2023, attached hereto as Exhibit 99.3 and Exhibit 99.4, respectively.

The information contained in Item 2.02 and Item 7.01, including the exhibits referenced therein, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section. Such information shall not be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

99.1 Select unaudited operating results for the second quarter ended June 30, 2023 and select key updates to 2023 guidance, issued by Alexandria Real Estate Equities, Inc. on July 13, 2023

99.2 Statement regarding certain aspects of the Company ’s business and prospects, dated July 13, 2023

99.3 Summary of development and redevelopment pipeline as of June 30, 2023

99.4 Dispositions and sales of partial interests as of June 30, 2023

99.5 Non-GAAP measures and definitions as of June 30, 20 23

104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

Forward-Looking Statements

This current report on Form 8-K, including the exhibits referenced herein, contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include words such as “forecast,” “guidance,” “projects,” “estimates,” “anticipates,” “goals,” “believes,” “expects,” “intends,” “may,” “plans,” “seeks,” “should,” or “will,” or the negative of these words or similar words. Forward-looking statements involve certain risks and uncertainties, and actual results may differ materially from those discussed in each such statement. A number of important factors could cause actual results to differ materially from those included within or contemplated by the forward-looking statements, including, but not limited to, the factors described in the Company’s filings with the Securities and Exchange Commission, including the Company’s most recent annual report on Form 10-K and any subsequent quarterly reports on Form 10-Q. The Company does not undertake any responsibility to update any of these factors or to announce publicly any revisions to any of the forward-looking statements contained in this or any other document, whether as a result of new information, future events, or otherwise.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


	ALEXANDRIA REAL ESTATE EQUITIES, INC.


July 13, 2023	By:	/s/ Dean A. Shigenaga
		Dean A. Shigenaga
		President and Chief Financial Officer

EXHIBIT 99.1

ALEXANDRIA REAL ESTATE EQUITIES, INC.

Select Operating Results for the Second Quarter Ended June 30, 2023

(Unaudited)

The following provides select unaudited operating results for the three and six months ended June 30, 2023.


		Three Months Ended					Six Months Ended
		June 30, 2023					June 30, 2023
	Including Straight-Line Rent			Cash Basis		Including Straight-Line Rent			Cash Basis
Leasing activity:
Renewed/re-leased space(1)
Rental rate changes(2)		16.6%			8.3%		35.1%			17.9%
New rates		$37.70			$36.43		$50.61			$48.51
Expiring rates		$32.32			$33.65		$37.47			$41.15
RSF		1,052,872	(3)				2,172,910	(3)
Tenant improvements		$26.53					$16.05
Tenant improvements/leasing commissions		$36.65					$26.31
Weighted-average lease term		13.0 years					9.5 years

Developed/redeveloped/previously vacant space leased
New rates		$64.23			$61.04		$57.44			$54.78
RSF		272,454					375,843
Weighted-average lease term		10.8 years					10.6 years

Leasing activity summary (totals):
New rates		$43.15			$41.49		$51.62			$49.44
RSF		1,325,326					2,548,753
Weighted-average lease term		12.2 years					9.7 years
Percentage of leases generated by our existing client base		77%					82%

Lease expirations(1)
Expiring rates		$37.57			$34.47		$40.93			$41.86
RSF		1,520,468					3,533,295

Leasing activity includes 100% of results for properties in which we have an investment in North America.

(1)Excludes month-to-month leases aggregating 82,025 RSF as of June 30, 2023.

(2)During the three months ended March 31, 2023, Alexandria’s rental rate growth was driven by lease renewals in the Greater Boston, San Francisco Bay Area, and Seattle markets. Alexandria’s rental rate growth during the three months ended June 30, 2023 was driven by renewals in the Seattle, Maryland, and Research Triangle markets. It is important to keep in mind that quarterly rental rate growth for lease renewals and re-leasing of space can be significantly skewed by a small number of leases or mix of leases (by submarket or property) executed in any quarter.

(3)During the trailing twelve months ended June 30, 2023, we granted free rent concessions averaging 0.5 months per annum.


Other operating metrics as of June 30, 2023
Occupancy of operating properties in North America	93.6	%
Vacancy from recently acquired properties	2.2	%
Percentage of total annual rental revenue in effect from investment-grade or publicly traded large cap tenants	49	%
Percentage of total annual rental revenue in effect from Top 20 tenants that are investment-grade or publicly traded large cap	90	%
Dividend yield (second quarter of 2023, annualized)	4.4	%
Number of tenants	Approximately 825

Annual Rental Revenue in AAA Locations(1)	Percentage of Total
Greater Boston	35	%
San Francisco Bay Area	23	%
New York City	5	%
San Diego	14	%
Seattle	6	%
Maryland	6	%
Research Triangle	6	%
Texas	3	%
Other	2	%

Annual Rental Revenue by Industry(1)	Percentage of Total		Per RSF
Life Science Product, Service, and Device	22	%	$	42.39
Multinational Pharmaceutical	17	%	$	60.88
Public Biotechnology – Approved or Marketed Product	14	%	$	60.29
Institutional (Academic/Medical, Non-Profit, and U.S. Government)	11	%	$	57.74
Public Biotechnology – Preclinical or Clinical Stage	10	%	$	69.46
Private Biotechnology	10	%	$	81.49
Investment-Grade or Large Cap Tech	8	%	$	35.89
Future Change in Use(2)	5	%	$	40.63
Other(3)	3	%	$	34.39

(1)Represents annual rental revenue in effect as of June 30, 2023.

(2)Represents annual rental revenue currently generated from space that is targeted for a future change in use, including 1.1% of total annual rental revenue that is generated from covered land play projects. The weighted-average remaining term of these leases is 3.8 years.

(3)Our other tenants, which represent an aggregate of 3.0% of our annual rental revenue, comprise technology, professional services, finance, telecommunications, and construction/real estate companies, and (by less than 1.0% of our annual rental revenue) retail-related tenants.

Select Key Updates to 2023 Guidance

The following provides select key updates to our 2023 guidance based on our current view of existing market conditions and other assumptions for the year ending December 31, 2023. There can be no assurance that actual amounts will not be materially higher or lower than these expectations.

Key updates to 2023 sources and uses of capital

Key updates to the midpoints of our guidance ranges for our 2023 key sources and uses of capital include the following:

•During the three months ended June 30, 2023, we pivoted our strategy toward harvesting value by selling 100% interests in non-core and/or properties no longer important to our mega campus strategy in lieu of seeking a new real estate joint venture partner for one of our active development projects.

•This resulted in increases to dispositions and sales of partial interests by $225 million and construction spending by $210 million.

•The revised midpoint to our 2023 guidance range for dispositions and sales of partial interests is $1.75 billion.

•The revised midpoint to our 2023 construction spending is $2.9 billion. Total 2023 construction spending before contributions from real estate joint venture partners remains unchanged from our prior forecast at $3.5 billion.


	Midpoint						As of 7/13/23
Key Sources and Uses of Capital	As of 4/24/23		Key Changes		As of 7/13/23		Range				Midpoint		Certain Completed Items
Sources of capital:
Incremental debt	$	650	$	(15)	$	635	$	560	$	710	$	635
Excess 2022 bond capital held as cash at December 31, 2022	300		—		300		300		300		300		$	300	(1)
Net cash provided by operating activities after dividends	375		—		375		350		400		375
Dispositions and sales of partial interests	1,525		225		1,750		1,650		1,850		1,750		$	701	(2)
Future settlement of forward equity sales agreements outstanding as of December 31, 2022	100		—		100		100		100		100		$	100	(3)
Total sources of capital before excess cash expected to be held at December 31, 2023	$	2,950	$	210	$	3,160	2,960		3,360		3,160
Cash expected to be held at December 31, 2023(4)	$	275	$	—	$	275	125		425		275
Total sources of capital							$	3,085	$	3,785	$	3,435
Uses of capital:
Construction	$	2,725	$	210	$	2,935	$	2,785	$	3,085	$	2,935
Acquisitions	225		—		225		175		275		225		$	236
	$	2,950	$	210	$	3,160	$	2,960	$	3,360	$	3,160
Incremental debt (included above):
Issuance of unsecured senior notes payable							$	1,000	$	1,000	$	1,000	$	1,000	(5)
Unsecured senior line of credit, commercial paper, and other							(440)		(290)		(365)
Net incremental debt							$	560	$	710	$	635

(1)Represents $300.0 million of excess 2022 bond capital proceeds held as cash at December 31, 2022 that was used to reduce our 2023 debt capital needs.

(2)Refer to Exhibit 99.4 for additional information on completed dispositions and sales of partial interests as of June 30, 2023.

(3)Represents outstanding forward equity sales agreements entered into in 2022 to sell 699 thousand shares of common stock under our ATM program.

(4)Represents estimated excess 2023 bond capital proceeds expected to be held as cash at December 31, 2023, which reduces our 2024 debt capital needs.

(5)Represents $1.0 billion of unsecured senior notes payable issued in February 2023.

Select key updates to projected 2023 earnings per share and funds from operations per share attributable to Alexandria’s common stockholders – diluted, as adjusted


Projected 2023 Earnings per Share and Funds From Operations per Share Attributable to Alexandria’s Common Stockholders – Diluted, as Adjusted
	As of 7/13/23		As of 4/24/23		Key Changes
Earnings per share(1)	$2.72 to $2.78		$2.21 to $2.31
Depreciation and amortization of real estate assets		5.55		5.55
Gain on sales of real estate		(1.26)		—
Impairment of real estate – rental properties(2)		0.98		0.81
Allocation to unvested restricted stock awards		(0.04)		(0.04)
Funds from operations per share(3)	$7.95 to $8.01		$8.53 to $8.63
Unrealized losses on non-real estate investments		0.84		0.39
Impairment of non-real estate investments(4)		0.13		—
Impairment of real estate(2)		0.02		—
Allocation to unvested restricted stock awards		(0.01)		(0.01)
Funds from operations per share, as adjusted	$8.93 to $8.99		$8.91 to $9.01		No change to midpoint; range narrowed by 4 cents
Midpoint	$8.96		$8.96

(1)Excludes unrealized gains or losses after June 30, 2023 that are required to be recognized in earnings and are excluded from funds from operations per share, as adjusted.

(2)Represents impairment charges recognized during 2Q23 aggregating $168.6 million, including $145.4 million at 275 Grove Street to reduce our investment in this campus to fair value less costs to sell, and $17.1 million to fully write down the carrying amount of our one remaining property in Asia.

(3)Refer to “Funds from operations and funds from operations, as adjusted, attributable to Alexandria’s common stockholders” in the “Definitions and Non-GAAP measures” section of this exhibit for additional details.

(4)Represents impairment charges recognized during 2Q23 aggregating $23.0 million, primarily related to three non-real estate investments in privately held entities that do not report NAV.


	As of 7/13/23		As of 4/24/23
	Low	High	Low	High	Key Changes

Occupancy percentage in North America as of December 31, 2023	94.6%	95.6%	94.6%	95.6%	No change
Lease renewals and re-leasing of space:
Rental rate increases	28.0%	33.0%	28.0%	33.0%
Rental rate increases (cash basis)	12.0%	17.0%	12.0%	17.0%

EXHIBIT 99.2

Alexandria Real Estate Equities, Inc., an S&P 500® REIT, is the first, preeminent, and longest-tenured owner, operator, and developer uniquely focused on collaborative life science campuses in AAA innovation cluster locations. Our mission — to create and grow life science ecosystems and clusters that ignite and accelerate the world’s leading innovators in their noble pursuit to advance human health by curing disease and improving nutrition — drives what we do and has shaped our pioneering business.

Renowned author and business strategist Jim Collins has said of the company’s track record, “Alexandria has achieved the three outputs that define a great company: Superior Results, Distinctive Impact, and Lasting Endurance.”

Alexandria’s irreplaceable life science real estate platform dominates the asset class we pioneered. Further, we continue to strengthen our balance sheet and enhance our significant liquidity, which provides us with important flexibility to drive forward this dominant platform and the critically important life science industry by delivering the highly complex infrastructure and fostering the holistic ecosystems needed to enable innovation to advance life-changing treatments and cures.

Following the successful and timely expansion of our unsecured senior line of credit to $5 billion at the end of June 2023, and in recognition and support of our world-class brand and differentiated business model, members of the company’s longstanding banking syndicate said:

•“The outcome of the trade exemplified where banks in today’s market want to allocate their capital. It’s clear that Alexandria’s credit quality and growth prospects far exceed most REITs, and that has translated into a positive impact on its access to bank capital and the structural/economic elements of the bank facility.”

•“Once again, Alexandria stands out as the best in class and proves able to accomplish what very few have been able to do. That truly is remarkable and a testament to the strength of your management team, amazing business strategy, and rock solid balance sheet.”

In 1994, we saw the remarkable potential of the life science industry, and today we are honored to be at the vanguard and heart of the broad and diverse life science ecosystem. As Steve Jobs said, “I think the biggest innovations of the 21st century will be at the intersection of biology and technology.” With over 10,000 diseases known to humankind and less than 10% currently addressable with therapies, the incredible innovation taking place within our Labspace® facilities is and will remain a national imperative.

Catalyzed by groundbreaking technologies, massive unmet medical need, and strong fundamentals, the life science industry remains uniquely positioned to tackle and solve our most persistent and major healthcare challenges. The emergence of a new golden age of biology only bolsters the strength and growth potential of this vital industry. It also reaffirms the fundamental truth Alexandria recognized nearly three decades ago: our integrated 24/7 scientific laboratory and supporting infrastructure is essential for advancing innovation that improves human health.

To learn more about our one-of-a-kind, once-in-a-generation company, please view our 2022 Annual Report and 2022 ESG Report on the company’s website at https://investor.are.com. A statement regarding certain aspects of our business and prospects can be found below.

ALEXANDRIA’S HIGH-QUALITY, DIFFERENTIATED, AND ESSENTIAL LABSPACE® ASSET BASE,
SUPPORTED BY STRONG LIFE SCIENCE INDUSTRY FUNDAMENTALS, IS WELL POSITIONED

•Utilization and demand for Alexandria’s essential 24/7, fully integrated, workflow-optimized infrastructure is driven by its tenants’ mission-critical need to house, operate, advance, and help safeguard billions of dollars of scientific research, development, and commercial assets, and not by a desire for high foot traffic as is applicable in a retail context.

•The secular growth life science industry, which has an estimated market value of over $5 trillion1 and approximately $450 billion in estimated 2023 R&D funding, fuels continuing demand for Alexandria’s Labspace assets across its cluster markets.

•Alexandria has created a robust moat through its strategic focus on aggregating its high-quality Labspace assets into highly sought-after mega campuses primarily concentrated in high-barrier-to-entry markets, which affords the company a competitive advantage against new supply.

•Alexandria’s operating and financial performance, fueled by fundamentals returning to historical pre-COVID-19 levels, drives continued growth.

1.Alexandria’s tenants rely on essential Labspace infrastructure for its intended purpose of providing 24/7 compliant, fully integrated, and workflow-optimized facilities to house, operate, advance, and help safeguard scientific research, pipeline programs, and commercial assets

•Alexandria’s Labspace infrastructure generally runs 24/7 and in aggregate houses and helps safeguard billions of dollars of high-intensity infrastructure, specialized equipment, and irreplaceable tenant research, clinical pipeline programs, and commercial assets.

•It is the advancement of this science and related intellectual property in Alexandria’s Labspace buildings, and NOT employee foot traffic that drives the utilization of and demand for space.

•Much like a data center, where the core infrastructure is required for data usage, throughput, and storage, Alexandria’s Labspace assets are needed to house, operate, advance, and help safeguard scientific throughput.

•Within Alexandria’s Labspace assets, the laboratories and adjacent nontechnical space cannot be decoupled. Each tenant space, floor, and building plan is fully integrated and intentionally designed to enable seamless workflows between the laboratory and nontechnical spaces within a leased premises. The representative image below highlights this critical integration.

1 Source: YCharts. Based on aggregate market capitalization for the life science industry, encompassing biotechnology companies, drug manufacturers, and diagnostics and research companies as of June 16, 2023.

•Based on its nearly 30 years of experience and expertise in life science real estate, Alexandria understands that the majority of tenant employees in its Labspace assets interact with the science in the laboratory in some form, including to conduct experiments, analyze and interpret data, plan new experiments, make business decisions about the data, or engage in other related activities. This is the nature of life science companies’ research workflows — critical aspects of which cannot be performed from home.

•Furthermore, laboratory work must be conducted in dedicated spaces in compliance with stringent safety requirements governed by city, state, and/or federal regulatory agencies. In addition, each tenant has its own protocols to protect the propriety of the intellectual property transpiring within Alexandria’s buildings, further necessitating on-site activity.

•Selling, general, and administrative (SG&A) functions, such as sales, marketing, legal, and accounting, do not comprise a significant portion of space within Alexandria’s Labspace asset base given tenants’ primary focus on research and development within its buildings.

•Large pharmaceutical, biotechnology, academic institutions, and life science product companies that do have more sizeable SG&A groups tend to prioritize Labspace infrastructure requirements with Alexandria and typically place these non-lab-related administrative functions in more traditional corporate office space.

•For example, one of Alexandria’s multinational pharmaceutical tenants in San Diego operates an over 150,000 RSF laboratory facility where 87% of the employees are focused on research (i.e. non-SG&A).

•Smaller pre-commercial public or private biotech companies by definition have minimal SG&A requirements (given the absence of products), and instead, the R&D and associated intellectual property, held and conducted in Alexandria spaces are the core assets for these companies.

•Lastly, Alexandria has observed key trends contributing to new specialized infrastructure requirements.

•The COVID-19 pandemic reaffirmed the essential nature of the life science industry, and the infrastructure that supports it, while also exposing supply chain pressures. As a result, it encouraged life science companies in the United States to repatriate novel research, development, and production as well as shift more chemistry and other basic R&D processes on shore.

•Concurrently, the complexity of new modalities that are enabling some of today’s most promising medicines, such as mRNA and cell and gene therapies, requires highly integrated research, development, and manufacturing infrastructure, resulting in more specialized technical space requirements.

Consistent electricity consumption demonstrates continued strong utilization and value of Alexandria’s Labspace asset base for which geospatial data analysis is not relevant

•Alexandria analyzed electricity consumption in a population of 112 properties, which represents a subset of its same property pool of 161 properties2 that it owned and operated for the entirety of the period from 2019 to 2022 and where complete electricity consumption data is available. Alexandria excluded 49 properties from its same property pool from 2019 to 2022 mainly because the properties’ electricity meters are held by tenants and Alexandria has either no data or only partial data on their electricity consumption.

•Electricity consumption in this subset of 112 properties increased approximately 1% between 2019 and 2022, indicating no significant change in the utilization of Alexandria’s life science assets. In other commercial real estate settings, a significant decline in electricity usage was observed such as in New York City during the COVID-19 pandemic.3

•Occupancy for this subset of 112 properties also remained consistent, with 97.6% as of 4Q19 and 97.5% as of 4Q22.

2 This same property pool is related to this analysis of electricity consumption and is different from our same property results disclosed in our quarterly earnings results.

3 Source: MDPI, “Analysis of Energy Consumption in Commercial and Residential Buildings in New York City before and during the COVID-19 Pandemic,” October 20, 2021.

•Given the essential usage of laboratory space and Alexandria’s tenants’ need for laboratories to generally run 24/7, metrics such as electricity consumption are appropriate proxies for scientific throughput and laboratory space utilization (which is analogous to the high-intensity data processing through a data center). Moreover, there are limitations associated with using geospatial data collected from cell phones as a tool to measure life science real estate asset utilization. Limitations of geospatial data include, but are not limited to, the following:

•Most geospatial data companies partner with mobile phone applications to track cell phone locations. The coverage of these applications varies widely, with one prominent geospatial company’s “partner apps” typically covering less than 10% of the U.S. population. As this sample size is not randomly selected, it is limited to regular users of one or more of the partner apps, which means that data in cell phone studies is inferred and is not a representative average of the population, and also most likely not of the life science employee base.

•Significant changes in data privacy that Apple and Google put into effect between 2019 and 2022 drove tremendous declines in the amount of data collected: data collection dropped by 70% for apps when not in use and by 24% when in use.4

▪Additionally, Apple’s release of iOS 14 in September 2020 further encumbered geolocation tracking by allowing users to only share an approximate location (within a few miles) instead of a precise one (which would be required for an accurate per property analysis).5

•Originally developed to track retail foot traffic, where validating data is possible due to built-in attributes such as turnstiles, ticket sales, and credit card receipts, geospatial data appears to be ill-suited for occupancy analysis in other settings if not carefully and consistently physically validated. Without this physical validation, material errors can occur based on location, timing of the data, analyzed area, and the inability to validate foot traffic.

4 Sources: The Wall Street Journal and FastCompany.

5 Source: Forbes.

2.Sustained strength of life science fundamentals and the need for essential infrastructure continue to serve as the foundation for demand for Alexandria’s Labspace assets

•Utilization of and demand for Alexandria’s Labspace infrastructure is fueled by the over $5 trillion6 life science industry, which is in the early innings of growth and dependent on laboratory space to conduct mission-critical research and to house, operate, advance, and help safeguard R&D and commercial assets.

•This secular growth industry is not significantly impacted by cyclicality, but by the achievement of scientific milestones and other resilient demand drivers that are generally less correlated with macro trends currently impacting commodity REIT product types.

•The broad and diverse sources of annual R&D funding fuel the continued secular growth of the industry with nearly $450 billion7 flowing into the industry in 2022, and 2023 expected to meet or exceed this level.

•Biopharma continues to invest heavily in R&D with a 57% increase in total spend on R&D over the past 10 years, driving new sources of demand that are associated with the advent of new platforms and modalities (e.g., mRNA, cell and gene therapies, single cell analytics, artificial intelligence) and the desire for life science companies to control their own research, development, and to a certain extent, manufacturing, of novel, complex medicines within specialized, fully integrated facilities8.

•The U.S. Food and Drug Administration (“FDA”) has approved over 450 new drugs over the past decade and is on track for a near-record high year of new drug approvals with up to 60 new approvals expected in 2023,9 collectively reflecting the productivity and impact of the life science industry in bringing new medicines to patients.

•Following a historic bull run, public market IPO issuances have stagnated, with a potential slight reopening on the horizon in 2H23, yet public markets continue to reward clinical progress for companies with strong, positive data, as demonstrated through their ability to raise follow-on financings in the hundreds of millions.10

•Life science employment continues to rise, up 87% from 2002 to 2022, compared to only a 14% increase for all U.S. occupations over the same time period.11

6 Source: YCharts. Based on aggregate market capitalization for the life science industry, encompassing biotechnology companies, drug manufacturers, and diagnostics and research companies as of June 16, 2023.

7 Source: Evaluate Pharma, PitchBook, BioCentury, NASDAQ, National Institutes of Health, National Science Foundation, and Giving USA.

8 Source: Evaluate Pharma.

9 Up to 60 new approvals based on scheduled Prescription Drug User Fee Act (PDUFA) dates in 2023. BioPharma Catalyst and FDATracker.com

10 Source: BioCentury and NASDAQ.

11 Source: CBRE Research.

3.Alexandria has strategically created a high quality Labspace® asset base primarily concentrated in high-barrier-to-entry markets where it has a competitive advantage against new supply

•Alexandria’s mega campus strategy and world-class brand provide the company a competitive advantage against new market supply across most of its operating asset base of 41 million RSF (as of June 30, 2023). To delve into the potential impact of new supply on the company’s operating assets, it is imperative to look at the company’s following four differentiators, as further described below:

1.Unique, highly complex Labspace assets concentrated in high-barrier-to-entry submarkets

2.Longstanding strategic relationships across its ecosystems

3.Differentiated mega campus offerings that drive value

4.Operational excellence to help safeguard leading-edge science

Alexandria’s unique, highly complex Labspace assets are primarily concentrated in high-barrier-to-entry submarkets

•Alexandria was founded on the belief that life science companies are most successful when positioned in the epicenter of the world’s top innovation ecosystems in close proximity to world-renowned academic medical institutions, deep specialized talent, and ample risk capital.

•Over the past three decades, Alexandria has strategically and methodically amassed a dominant market presence primarily in these AAA innovation locations where the adjacency to these top institutions is a key driver of tenant demand.

Alexandria’s longstanding strategic relationships across its ecosystems

•Alexandria, known for its longstanding relationships within the life science and real estate communities, has diligently cultivated a high-quality and diverse client base of approximately 825 tenants as of June 30, 2023.

•As a testament to its ability to strategically partner and form long-term strategic relationships with its tenants, Alexandria leased 2.55 million RSF during the six months ended June 30, 2023, 82% of which was generated from existing tenants.

Alexandria’s differentiated mega campus offerings drive value

•Alexandria’s pioneering mega campus strategy was borne out of its vision to provide engaging workplace environments that drive productivity, collaboration, and innovation for its life science tenants as scientific research cannot be performed from home.

•Alexandria’s highly amenitized, vibrant mega campuses, which are defined as cluster campuses that consist of approximately 1 million RSF or more, including operating, active development/redevelopment, and land RSF,12 encompass 73% of Alexandria’s annual rental revenue as of March 31, 2023.

◦Three of the country’s foremost, in-demand Alexandria mega campuses, which aggregate over 5 million RSF in operation or under construction, are in Cambridge’s Kendall Square, which has been called the most innovative square mile on the planet.13

12 Excludes RSF that is currently operating, but is expected to be demolished for future development opportunities upon expiration of the existing in-place lease.

13 Source: Massachusetts Institute of Technology, "Kendall Square Initiative.”

•Two notable examples that demonstrate the continued demand for Alexandria’s unrivaled mega campuses are large-scale development projects with long-term leases to Moderna, Inc. and Bristol-Myers Squibb Company, which were executed in September 2021 and February 2022, respectively:

•A 462,100 RSF headquarters and core R&D center for Moderna at 325 Binney Street on the Alexandria Center® at One Kendall Square mega campus in the Cambridge/Inner Suburbs submarket of Greater Boston. The Class A+ active development project is expected to deliver in late 2023, when Moderna anticipates beginning its move-in process.

•A 426,927 RSF R&D facility for Bristol Myers Squibb at 4135 Campus Point Court on the Campus Point by Alexandria mega campus in the University Town Center submarket of San Diego. The Class A+ near-term development project is expected to commence construction in the next three quarters.

Alexandria’s operational excellence helps safeguard leading-edge science

•Alexandria provides direct asset management and operations of its Labspace asset base. Its operational excellence helps safeguard billions of dollars of high-intensity infrastructure, specialized equipment, and irreplaceable tenant research and clinical pipeline assets.

•Importantly, this laboratory-based scientific research cannot be performed from home and must be conducted in dedicated spaces in compliance with stringent laboratory safety requirements governed by city, state, and/or federal regulatory agencies.

•Alexandria’s team includes well-educated and credentialed in-house facilities specialists who drive operational and technical capabilities commensurate with other similarly rigorous industries as part of the United States’ critical infrastructure.

4. Not all new supply is competitive with Alexandria’s asset base

•Alexandria designs, develops, owns, and operates an asset base consisting of predominantly Class A/A+ facilities in AAA innovation cluster locations in close proximity to world-renowned research institutions, deeply specialized talent, and ample risk capital — which it coalesces to enable life science companies to accelerate discovery and commercialization. Alexandria segments the life science laboratory market into the following categories:


Class A+			Class A
•High-quality, new expertly designed and purpose-built laboratory facilities integrated into highly curated mega campuses •Proximate to the nation’s leading academic and medical research institutions •Operated by a fully integrated, deeply skilled technical team •Strong capitalization			•New high-quality development and redevelopment laboratory facilities that meet general specifications for basic research and development work •Operated by competent technical teams •Generally adjacent to other similar assets or integrated into a campus/mega campus •Reasonably or well capitalized
Class B			Class C
•New one-off construction generally in line with office design and construction characteristics •Limited and/or minimal to no operational expertise and challenging capital structure			•New one-off redevelopment of poor base building infrastructure •No operational expertise and thinly capitalized

•Such differentiated infrastructure offerings and operational excellence by Alexandria afford the company a competitive advantage against most new market supply. Although the company does consider some Class B projects competitive, the majority of the projects it competes with are classified as Class A/A+. A summary of available competitive supply is shown below, gleaned from Alexandria’s rigorous building-by-building tracking of supply in each of its markets:

5. Operating and financial performance, fueled by fundamentals returning to historical pre-COVID-19 levels, drives continued growth

The company projects growth in funds from operations per share attributable to Alexandria’s common stockholders – diluted, as adjusted (“FFO per share – diluted, as adjusted”) of 6.4% in 2023, at the midpoint of its 2023 guidance affirmed on July 13, 2023, compared to 2022, as Alexandria continues to benefit from its differentiated business platform uniquely focused on providing the complex laboratory infrastructure needed to support the life science industry’s pursuit of desperately needed treatments and cures. The consistent increase of FFO per share – diluted, as adjusted is the result of continued strength in the leasing volume, rental rates, and occupancy.

•Alexandria’s FFO per share – diluted, as adjusted continues to grow as follows:

•Alexandria’s 2023 FFO per share – diluted, as adjusted growth (based on the midpoint of its 2023 guidance affirmed on July 13, 2023) of 6.4% extends the solid historical growth that the company achieved prior to the COVID-19 pandemic.

Alexandria’s leasing volume in 4Q21 and 1Q22 were the highest in company history, driven by the exceptional record-level tenant demand over historical norms due to, among other drivers, extraordinary additional funding and resources to address the COVID-19 pandemic.

•Alexandria’s leasing volume for the six months ended June 30, 2023 of 2.55 million RSF, or 5.1 million RSF on an annualized basis, has normalized to historical pre-COVID-19 levels of 4.2 million RSF on an annual basis from 2013 to 2020 and 1.1 million RSF on a quarterly basis from 2016 to 2020.

During the COVID-19 pandemic and into 2023, the majority of Alexandria’s tenants who have renewed their leases, have in aggregate retained or expanded their original footprints, which is generally consistent with the trend prior to COVID-19. Alexandria has seen no evidence indicating a trend of its tenants significantly reducing their square footage upon renewal. In fact, there was positive expansion during each year, except for the six months ended June 30, 2023, in which one tenant slightly reduced their RSF footprint as a result of the wind down in the COVID-19 testing portion of their business.

•Strong rental rate increases continue to be a driver of Alexandria’s internal growth.

•During 1Q23, Alexandria’s rental rate growth was driven by lease renewals in the Greater Boston, San Francisco Bay Area, and Seattle markets. Alexandria’s 2Q23 rental rate growth of 16.6% and 8.3% (cash basis) was driven by renewals in the Seattle, Maryland, and Research Triangle markets. It is important to keep in mind that quarterly rental rate growth for lease renewals and re-leasing of space can be significantly skewed by a small number of leases or mix of leases (by submarket or property) executed. Alexandria’s outlook for rental rate growth related to lease renewals and re-leasing of space remains solid with guidance ranges for 2023 rental rate increases of 28% to 33% and 12% to 17% (cash basis) noted in the chart above.

Alexandria’s occupancy has proven resilient through various real estate cycles, including during the Great Financial Crisis of 2008–2009 with only a 70-basis point decline in occupancy percentage. As of June 30, 2023, its value-creation pipeline projects include spaces aggregating 4.2 million RSF under construction that are 94% leased and expected to reach stabilized occupancy by December 31, 2024.

•Alexandria’s occupancy as of June 30, 2023 remained strong at 93.6%, which includes vacancy of 2.2% from properties recently acquired in 2021 or 2022 primarily from lease-up opportunities. Occupancy is expected to increase by the end of 2023 to a range between 94.6% and 95.6%. Over the last 15 years, tenant demand for Alexandria’s properties has resulted in consistently high occupancy through various macro environments.

With 93% of Alexandria’s leases structured as triple-net leases, which allow for the recovery of operating expenses and capital expenditures, Alexandria believes it is inaccurate to compare its in-place triple-net rental rates to that of traditional Class A office space which is typically leased and reported on a gross basis, without the full recovery of operating expenses from tenants.

•Alexandria’s reported annual rental revenue per RSF in the table below excludes expenses recovered from its tenants. In its coastal markets,14 expenses recovered from Alexandria’s tenants ranged from approximately $22 per RSF in San Diego to $34 per RSF in New York City for the twelve months ended March 31, 2023.

14 Includes our Greater Boston, San Francisco Bay Area, New York City, and San Diego markets.

•In addition, the following table provides annual rental revenue per RSF for the industry mix of Alexandria’s diverse tenant base, excluding tenant recoveries.

•Alexandria’s asset base continues to require only a modest level of overall non-revenue-enhancing capital expenditures as a percentage of net operating income. Non-revenue-enhancing capital expenditures include all additions to real estate except for costs related to ground-up development or first-time conversion of non-laboratory space to laboratory space through redevelopment. Historical non-revenue-enhancing capital expenditures have averaged 15% of net operating income and are trending lower for both 2022 and 2023. This low level of non-revenue-enhancing capital expenditure demonstrates the high durability and reusability of Alexandria’s infrastructure space through multiple lease terms.

•Alexandria’s tenant improvement allowances for the re-lease/renewal of space, included in the chart immediately above, remain low, again evidencing the high durability and reusability of Alexandria’s infrastructure space.

6. Alexandria continues its market leadership with a strong and flexible balance sheet, increasing dividends, and continued execution of its capital recycling program through partial interest sales and enhancement of its asset base with dispositions of non-core properties

•Alexandria’s strong and flexible balance sheet underpins not only robust financial performance for Alexandria’s shareholders, but also supports Alexandria’s value proposition to its tenants. Tenants value a landlord with a strong and flexible balance sheet and a partner they know will be there to service their complex needs for years to come. Key metrics from the company’s REIT industry-leading balance sheet as of March 31, 2023, include the following:

•Investment-grade credit ratings that rank in the top 10% among all publicly traded U.S. REITs.

•$5.3 billion of liquidity.

•No debt maturities prior to 2025.

•13.4 years weighted-average remaining term of debt.

•96.1% of debt has a fixed interest rate.

•In June 2023, Alexandria increased commitments available under its unsecured senior line of credit from $4 billion to $5 billion, further bolstering its already significant liquidity.

•Additionally, the company’s premier financial and operational reporting practices have earned it eight NAREIT Investor CARE (Communications and Reporting Excellence) awards, including seven Gold Awards since 2015 — the most Gold Awards by any equity REIT.

•Alexandria’s continued strong and increasing dividends yield of 4.4% as of June 30, 2023 also supports the reinvestment of significant net cash flows from operating activities after dividends.

•Alexandria’s strong and timely execution of its strategic value harvesting and asset recycling program to raise accretive capital has demonstrated continuing solid demand for its scarce, high-quality life science assets.

•On April 12, 2023, Alexandria announced the completion of its sale of a 20% partial interest in its 15 Necco Street property in the Seaport Innovation District submarket of Greater Boston, which consists of an 18% interest sold by Alexandria and a 2% interest sold by an existing partner. The sales price of the 18% interest sold by Alexandria was $66.1 million, and Alexandria expects the new joint venture partner to contribute capital approximating $130 million to fund construction of the project over time and to accrete its ownership interest in the joint venture from 20% to 37%.

•On May 24, 2023, Alexandria announced the completion of the sale of 11119 North Torrey Pines Road in San Diego. The fully leased 72,506 RSF single-tenant property sold for $86 million at a strong capitalization rate of 4.6% (based upon cash net operating income for 1Q23 annualized).

•On June 20, 2023, Alexandria announced that an affiliate of the company completed the sale of five non-core, non-mega campus properties aggregating 428,663 RSF in Greater Boston. Alexandria sold the portfolio for $365 million, or an average sales price of $852 per RSF, and at a weighted-average capitalization rate of 5.2% (based upon cash net operating income for 2Q23 annualized) which includes vacancy available for redevelopment, resulting in a gain on sale of $187.2 million and a value-creation margin of 80%.

•On June 22, 2023, Alexandria announced the recapitalization of an existing joint venture for 9625 Towne Centre Drive in its University Town Center submarket in San Diego. The 70% partial interest sale in this consolidated real estate joint venture comprised a 20.1% interest sold by Alexandria and a 49.9% interest sold by the previous joint venture partner and was completed at a total property valuation of $160.5 million, or $981 per RSF, and at a strong cash capitalization rate of 4.5% (based upon cash net operating income for 2Q23 annualized). Upon completion of the sale, Alexandria’s ownership in the joint venture is 30%.

•In June 2023, Alexandria signed a purchase and sale agreement for the disposition of 268,000 RSF of a 660,034 RSF Class A near-term development at 421 Park Drive, in its Fenway submarket of Greater Boston, to an affiliate of Boston Children’s Hospital. Initial proceeds at closing are estimated to be $155 million and will help fund Alexandria’s remaining approximately 392,000 RSF of the project.

•The project is expected to commence vertical construction later this year and be substantially complete in 2026.

•Boston Children’s Hospital will fund the project costs related to its 268,000 RSF and these costs are not included in Alexandria’s projected construction spending as they will be the obligation of Boston’s Children’s Hospital.

•Alexandria will develop and operate the completed project and will earn development fees over the next three years.

•Inclusive of the above transactions, $976.0 million, or 53%, of Alexandria’s $1.85 billion capital plan is completed or subject to executed letters of intent or purchase and sales agreements, including $701.0 million from completed dispositions and partial interest sales, $175.0 million from dispositions under executed letters of intent or purchase and sales agreements, and approximately $100 million from forward equity sales agreements that were outstanding as of December 31, 2022.

•Proceeds from these strategic dispositions and sales of partial interests will be reinvested into the company’s highly leased value-creation pipeline, which consists of large-scale research and development facilities for some of the world’s leading life science companies, including Eli Lilly, Bristol Myers Squibb, and Moderna.

•Alexandria expects to continue its positive momentum into 2H23, executing the remainder of its dispositions and partial interest sales at attractive values and capitalization rates. Importantly, its 2023 capital plan assumes that Alexandria does not issue any additional common equity.

Forward-Looking Statements

This document includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements include, without limitation, statements regarding our expectations for future funds from operations (FFO) per share, property occupancy, leasing volumes, rental rate growth, and dividend payments and other statements regarding Alexandria’s future operating or financial performance, including our outlook for future growth, the expected pace of FDA drug approvals and expected life science research and development funding levels. These forward-looking statements are based on Alexandria’s present intent, beliefs, or expectations, but forward-looking statements are not guaranteed to occur and may not occur. Actual results may differ materially from those contained in or implied by Alexandria’s forward-looking statements as a result of a variety of factors, including, without limitation, the risks and uncertainties detailed in its filings with the Securities and Exchange Commission. All forward-looking statements are made as of the date of this document, and Alexandria assumes no obligation to update this information. For more discussion relating to risks and uncertainties that could cause actual results to differ materially from those anticipated in Alexandria’s forward-looking statements, and risks and uncertainties to Alexandria’s business in general, please refer to Alexandria’s filings with the Securities and Exchange Commission, including its most recent annual report on Form 10-K and any subsequently filed quarterly reports on Form 10-Q.

EXHIBIT 99.3

ALEXANDRIA REAL ESTATE EQUITIES, INC.

Class A/A+ Development and Redevelopment Properties: Current Projects

The following tables set forth a summary of our new Class A/A+ development and redevelopment properties under construction and pre-leased/negotiating near-term projects as of June 30, 2023:


Property/Market/Submarket		Square Footage			Percentage					Occupancy(1)
	Dev/Redev	In Service	CIP	Total	Leased		Leased/Negotiating			Initial		Stabilized
Under construction
2023 stabilization
140 First Street/Greater Boston/Cambridge/Inner Suburbs	Redev	329,713	78,546	408,259	100	%	100	%			2Q23	2023
201 Brookline Avenue/Greater Boston/Fenway	Dev	451,967	58,149	510,116	98		98				3Q22	2023
751 Gateway Boulevard/San Francisco Bay Area/South San Francisco	Dev	—	230,592	230,592	100		100				2023	2023
		781,680	367,287	1,148,967	99		99
2024 stabilization
325 Binney Street/Greater Boston/Cambridge/Inner Suburbs	Dev	—	462,100	462,100	100		100				2023	2024
15 Necco Street/Greater Boston/Seaport Innovation District	Dev	—	345,995	345,995	97		97				2023	2024
840 Winter Street/Greater Boston/Route 128	Redev	28,534	139,680	168,214	100		100				2024	2024
230 Harriet Tubman Way/San Francisco Bay Area/South San Francisco	Dev	—	285,346	285,346	100		100				2024	2024
4155 Campus Point Court/San Diego/University Town Center	Dev	—	171,102	171,102	100		100				2024	2024
1150 Eastlake Avenue East/Seattle/Lake Union	Dev	—	311,631	311,631	99		99				2023	2024
Alexandria Center® for Advanced Technologies – Monte Villa Parkway/Seattle/Bothell	Redev	282,494	178,129	460,623	82		82				1Q23	2024
9820 Darnestown Road/Maryland/Rockville	Dev	—	250,000	250,000	100		100				2024	2024
9810 Darnestown Road/Maryland/Rockville	Dev	—	192,000	192,000	100		100				2024	2024
9601 and 9603 Medical Center Drive/Maryland/Rockville	Redev	48,516	47,395	95,911	100		100				4Q21	2024
9808 Medical Center Drive/Maryland/Rockville	Dev	—	95,061	95,061	37		55				2023	2024
6040 George Watts Hill Drive, Phase II/Research Triangle/Research Triangle	Dev	—	88,038	88,038	100		100				2024	2024
8800 Technology Forest Place/Texas/Greater Houston	Redev	46,434	84,331	130,765	36		36				2Q23	2024
		405,978	2,650,808	3,056,786	92		93
		1,187,658	3,018,095	4,205,753	94		94
2025 and beyond stabilization
99 Coolidge Avenue/Greater Boston/Cambridge/Inner Suburbs	Dev	—	320,809	320,809	36		36				2024	2025
500 North Beacon Street and 4 Kingsbury Avenue/Greater Boston/ Cambridge/Inner Suburbs	Dev	—	248,018	248,018	85		85				2024	2025
40, 50, and 60 Sylvan Road/Greater Boston/Route 128	Redev	—	515,273	515,273	—		—				2024	2026
Other/Greater Boston	Redev	—	453,869	453,869	—		—				2024	2025
1450 Owens Street/San Francisco Bay Area/Mission Bay	Dev	—	212,796	212,796	—		—				2024	2025
651 Gateway Boulevard/San Francisco Bay Area/South San Francisco	Redev	—	300,010	300,010	15		22				2023	2025
Canada	Redev	32,992	217,798	250,790	73		73				2023	2025
		32,992	2,268,573	2,301,565	24		25		(2)

		1,220,650	5,286,668	6,507,318	69	%	70	%
(1)Initial occupancy dates are subject to leasing and/or market conditions. Stabilized occupancy may vary depending on single tenancy versus multi-tenancy. Multi-tenant projects may increase in occupancy over a period of time. (2)These projects are focused on demand from our existing tenants in our adjacent properties/campuses and will also address demand from other non-Alexandria properties/campuses.

Class A/A+ Development and Redevelopment Properties: Current Projects (continued)


Property/Market/Submarket		Square Footage			Percentage
	Dev/Redev	In Service	CIP	Total	Leased			Leased/Negotiating
Near-term projects expected to commence construction in the next three quarters
2025 and beyond stabilization
401 and 421 Park Drive/Greater Boston/Fenway	Redev/Dev	111,294	392,011	503,305	10	%		10	%
11255 and 11355 North Torrey Pines Road/San Diego/Torrey Pines	Dev	—	309,094	309,094	100			100
10931 and 10933 North Torrey Pines Road/San Diego/Torrey Pines	Dev	—	299,158	299,158	100			100
4135 Campus Point Court/San Diego/University Town Center	Dev	—	426,927	426,927	100			100
		111,294	1,427,190	1,538,484	71			71
Total		1,331,944	6,713,858	8,045,802	70	%	(1)	70	%

(1) Decline from 72% as of 1Q23 results from the inclusion of our near-term project at 401 and 421 Park Drive in our Greater Boston market. Refer to exhibit 99.2 for additional information regarding this project. Excluding this addition, our total current and near-term projects expected to commence construction in the next three quarters are 74% leased as of July 13, 2023.

EXHIBIT 99.4

ALEXANDRIA REAL ESTATE EQUITIES, INC.

Dispositions and Sales of Partial Interests

Our completed and pending dispositions of and sales of partial interests in real estate assets during the six months ended June 30, 2023 consisted of the following (dollars in thousands):


Property	Submarket/Market	Date of Sale	Interest Sold			RSF	Sales Price
Completed in 1H23:
Value harvesting dispositions and recycling of assets no longer important to our mega campus strategy
225, 266, and 275 Second Avenue and 780 and 790 Memorial Drive(1)	Route 128 and Cambridge/Inner Suburbs/Greater Boston	6/13/23	100	%		428,663	$	365,226
11119 North Torrey Pines Road(2)	Torrey Pines/San Diego	5/4/23	100	%		72,506	86,000
275 Grove Street(3)	Route 128/Greater Boston	6/27/23	100	%		509,702	109,349
Other							42,092
							602,667		(4)
Strategic partial interest sales
15 Necco Street(5)	Seaport Innovation District/Greater Boston	4/11/23	18	%	(5)	345,995	66,108
9625 Towne Centre Drive(6)	University Town Center/San Diego	6/21/23	20.1	%		163,648	32,261
							98,369
							701,036
Pending as of July 13, 2023:
421 Park Drive(7)	Fenway/Greater Boston		(7)			(7)	155,000
Executed and pending transactions subject to signed letters of intent or purchase and sale agreements							20,000
							876,036
Other targeted disposition and sales of partial interests							873,964
2023 dispositions and sales of partial interests (midpoint)							$	1,750,000

2023 guidance range						$1,650,000 – $1,850,000

(1)We completed the sale of five non-mega campus properties for an aggregate sales price of $365.2 million, or $852 per RSF, representing capitalization rates of 5.0% and 5.2% (cash basis) based upon net operating income for the three months ended June 30, 2023 annualized that includes vacancy available for redevelopment. Upon completion of the sale, we recognized a gain on sale of real estate aggregating $187.2 million and a value-creation margin of 80%.

(2)We completed the sale of 11119 North Torrey Pines Road for an aggregate sales price of $86.0 million, or $1,186 per RSF, representing capitalization rates of 4.4% and 4.6% (cash basis) based upon net operating income for the three months ended March 31, 2023 annualized. Upon completion of the sale, we recognized a gain on sale of real estate aggregating $27.6 million and a value-creation margin of 34%.

(3)During the three months ended June 30, 2023, we recognized a real estate impairment charge of $145.4 million to reduce our investment in this campus to its current fair value less costs to sell. This property was our only pure office campus in Greater Boston.

(4)Dispositions completed during the three months ended June 30, 2023 had annual net operating income of $32.4 million with a weighted-average disposition date of June 13, 2023 (weighted by net operating income for the three months ended June 30, 2023 annualized).

(5)Represents a development project under construction aggregating 345,995 RSF, 97% of which is leased to the Lilly Institute for Genetic Medicine. In April 2023, an investor acquired a 20% interest in this joint venture, which consists of an 18% interest sold by us and a 2% interest sold by our existing partner. Upon completion of the sale, our ownership interest in the consolidated real estate joint venture was 72% and our existing and new partners’ noncontrolling interests were 8% and 20%, respectively. We retained control over this real estate joint venture and therefore continue to consolidate it. In addition to our share of the sales price of $66.1 million, we expect our new joint venture partner to contribute capital aggregating $130 million to fund construction spending over time and to accrete its ownership interest in the joint venture from 20% to 37%.

(6)An investor acquired a 70.0% interest in this consolidated real estate joint venture, which consisted of a 20.1% interest sold by us and a 49.9% interest held by our previous joint venture partner. Our portion of the sales price was $32.3 million, or $981 per RSF, representing capitalization rates of 4.2% and 4.5% (cash basis) based upon net operating income for the three months ended June 30, 2023 annualized. We retained control over this real estate joint venture and therefore continue to consolidate this property. This transaction resulted in consideration in excess of book value of $15.6 million and a value-creation margin of 88%.

(7)Represents the disposition of 268,000 RSF of a 660,034 RSF Class A near-term development at 421 Park Drive. Initial proceeds at closing are estimated to be $155 million and will help fund Alexandria’s remaining approximately 392,000 RSF of the project. The project is expected to commence vertical construction later this year and be substantially complete in 2026. The buyer will fund the project costs related to its 268,000 RSF and these costs are not included in Alexandria’s projected construction spending. Alexandria will develop and operate the completed project and will earn development fees over the next three years.

EXHIBIT 99.5

Non-GAAP Measures and Definitions

Annual rental revenue

Annual rental revenue represents the annualized fixed base rental obligations, calculated in accordance with GAAP, for leases in effect as of the end of the period, related to our operating RSF. Annual rental revenue is presented using 100% of the annual rental revenue from our consolidated properties and our share of annual rental revenue for our unconsolidated real estate joint ventures. Annual rental revenue per RSF is computed by dividing annual rental revenue by the sum of 100% of the RSF of our consolidated properties and our share of the RSF of properties held in unconsolidated real estate joint ventures. As of June 30, 2023, approximately 93% of our leases (on an annual rental revenue basis) were triple net leases, which require tenants to pay substantially all real estate taxes, insurance, utilities, repairs and maintenance, common area expenses, and other operating expenses (including increases thereto) in addition to base rent. Annual rental revenue excludes these operating expenses recovered from our tenants. Amounts recovered from our tenants related to these operating expenses, along with base rent, are classified in income from rentals in our consolidated statements of operations.

Capitalization rates

Capitalization rates are calculated based on net operating income and net operating income (cash basis) annualized, excluding lease termination fees, for the quarter preceding the date on which the property is sold, or near-term prospective net operating income.

Class A/A+ properties and AAA locations

Class A/A+ properties are properties clustered in AAA locations that provide innovative tenants with highly dynamic and collaborative environments that enhance their ability to successfully recruit and retain world-class talent and inspire productivity, efficiency, creativity, and success. Class A/A+ properties generally command higher annual rental rates than other classes of similar properties.

AAA locations are in close proximity to concentrations of specialized skills, knowledge, institutions, and related businesses. Such locations are generally characterized by high barriers to entry for new landlords, high barriers to exit for tenants, and a limited supply of available space.

Dividend yield

Dividend yield for the quarter represents the annualized quarter dividend divided by the closing common stock price at the end of the quarter.

Funds from operations and funds from operations, as adjusted, attributable to Alexandria’s common stockholders

GAAP-basis accounting for real estate assets utilizes historical cost accounting and assumes that real estate values diminish over time. In an effort to overcome the difference between real estate values and historical cost accounting for real estate assets, the Nareit Board of Governors established funds from operations as an improved measurement tool. Since its introduction, funds from operations has become a widely used non-GAAP financial measure among equity REITs. We believe that funds from operations is helpful to investors as an additional measure of the performance of an equity REIT. Moreover, we believe that funds from operations, as adjusted, allows investors to compare our performance to the performance of other real estate companies on a consistent basis, without having to account for differences recognized because of real estate acquisition and disposition decisions, financing decisions, capital structure, capital market transactions, variances resulting from the volatility of market conditions outside of our control, or other corporate activities that may not be representative of the operating performance of our properties.

The 2018 White Paper published by the Nareit Board of Governors (the “Nareit White Paper”) defines funds from operations as net income (computed in accordance with GAAP), excluding gains or losses on sales of real estate, and impairments of real estate, plus depreciation and amortization of operating real estate assets, and after adjustments for our share of consolidated and unconsolidated partnerships and real estate joint ventures. Impairments represent the write-down of assets when fair value over the recoverability period is less than the carrying value due to changes in general market conditions and do not necessarily reflect the operating performance of the properties during the corresponding period.

Non-GAAP Measures and Definitions (continued)

We compute funds from operations, as adjusted, as funds from operations calculated in accordance with the Nareit White Paper, excluding significant gains, losses, and impairments realized on non-real estate investments, unrealized gains or losses on non-real estate investments, gains or losses on early extinguishment of debt, significant termination fees, acceleration of stock compensation expense due to the resignation of an executive officer, deal costs, the income tax effect related to such items, and the amount of such items that is allocable to our unvested restricted stock awards. Neither funds from operations nor funds from operations, as adjusted, should be considered as alternatives to net income (determined in accordance with GAAP) as indications of financial performance, or to cash flows from operating activities (determined in accordance with GAAP) as measures of liquidity, nor are they indicative of the availability of funds for our cash needs, including our ability to make distributions.


	2023 Projected	2022		2021		2020		0	2019		2018		2017		2016		2015		2014		2013
Net income per share attributable to Alexandria’s common stockholders – diluted	$2.72 to $2.78	$	3.18	$	3.82	$	6.01		$	3.12	$	3.52	$	1.58	$	(1.99)	$	1.63	$	1.01	$	1.60
Depreciation and amortization of real estate assets	5.55	5.47		5.07		5.01			4.60		4.50		4.35		4.02		3.64		3.15		2.80
Our share of gain on sale of real estate from unconsolidated JVs	—	—		—		—			—		(0.35)		(0.15)		—		—		—		—
Gain on sales of real estate	(1.26)	(3.33)		(0.86)		(1.22)			—		(0.08)		—		(0.05)		(0.17)		(0.03)		—
Impairment of real estate – rental properties	0.98	0.13		0.17		0.32			0.11		—		—		1.29		0.33		0.38		—
Gain on sale of real estate – land parcels	—	—		—		—			—		—		—		—		—		(0.09)		(0.07)
Allocation to unvested restricted stock awards	(0.04)	(0.01)		(0.04)		(0.05)			(0.06)		(0.06)		—		—		—		—		—
Funds from operations per share attributable to Alexandria’s common stockholders – diluted	$7.95 to $8.01	5.44		8.16		10.07			7.77		7.53		5.78		3.27		5.43		4.42		4.33
Unrealized losses (gains) on non-real estate investments	0.84	2.55		(0.30)		(2.96)			(1.44)		(0.96)		—		—		—		—		—
Significant realized gains on non-real estate investments	—	—		(0.75)		—			—		(0.14)		—		(0.06)		(0.18)		—		—
Impairments of real estate – land parcels and non-real estate investments	0.13	0.13		—		0.19			0.15		0.11		0.09		1.47		—		0.34		0.01
Impairment of real estate	0.02	0.27		0.18		0.12			—		—		—		—		—		—		—
Acquisition-related expenses	—	—		—		—			—		—		—		—		—		—		0.02
Loss on early extinguishment of debt	—	0.02		0.46		0.48			0.42		0.01		0.03		0.04		—		0.01		0.04
Loss on early termination of interest rate hedge agreements	—	—		—		—			0.02		—		—		—		—		—		—
Termination fee	—	—		—		(0.68)			—		—		—		—		—		—		—
Acceleration of stock compensation expense due to executive officer resignation	—	0.04		—		0.04			—		—		—		—		—		—		—
Our share of gain on early extinguishment of debt from unconsolidated real estate JVs	—	—		—		—			—		(0.01)		—		—		—		—		—
Preferred stock redemption charge	—	—		—		—			0.02		0.04		0.12		0.79		—		0.03		—
Allocation to unvested restricted stock awards	(0.01)	(0.03)		0.01		0.04			0.02		0.02		—		—		—		—		—
Funds from operations per share attributable to Alexandria’s common stockholders – diluted, as adjusted	$8.93 to $8.99	$	8.42	$	7.76	$	7.30		$	6.96	$	6.60	$	6.02	$	5.51	$	5.25	$	4.80	$	4.40

Investment-grade or publicly traded large cap tenants

Investment-grade or publicly traded large cap tenants represent tenants that are investment-grade rated or publicly traded companies with an average daily market capitalization greater than $10 billion for the twelve months ended June 30, 2023, as reported by Bloomberg Professional Services. Credit ratings from Moody’s Investors Service and S&P Global Ratings reflect credit ratings of the tenant’s parent entity, and there can be no assurance that a tenant’s parent entity will satisfy the tenant’s lease obligation upon such tenant’s default. We monitor the credit quality and related material changes of our tenants. Material changes that cause a tenant’s market capitalization to decrease below $10 billion, which are not immediately reflected in the twelve-month average, may result in their exclusion from this measure.

Non-GAAP Measures and Definitions (continued)

Mega campus

Mega campuses are cluster campuses that consist of approximately 1 million RSF or more, including operating, active development/redevelopment, and land RSF less operating RSF expected to be demolished.

Net cash provided by operating activities after dividends

Net cash provided by operating activities after dividends includes the deduction for distributions to noncontrolling interests. For purposes of this calculation, changes in operating assets and liabilities are excluded as they represent timing differences.

Net operating income and net operating income (cash basis)

Net operating income is a non-GAAP financial measure calculated as net income, the most directly comparable financial measure calculated and presented in accordance with GAAP, excluding equity in the earnings of our unconsolidated real estate joint ventures, general and administrative expenses, interest expense, depreciation and amortization, impairments of real estate, gains or losses on early extinguishment of debt, gains or losses on sales of real estate, and investment income or loss. We believe net operating income provides useful information to investors regarding our financial condition and results of operations because it primarily reflects those income and expense items that are incurred at the property level. Therefore, we believe net operating income is a useful measure for investors to evaluate the operating performance of our consolidated real estate assets. Net operating income on a cash basis is net operating income adjusted to exclude the effect of straight-line rent and amortization of acquired above- and below-market lease revenue adjustments required by GAAP. We believe that net operating income on a cash basis is helpful to investors as an additional measure of operating performance because it eliminates straight-line rent revenue and the amortization of acquired above- and below-market leases.

Non-revenue-enhancing capital expenditures

Non-revenue-enhancing capital expenditures include revenue-enhancing/repositioning capital expenditures, non-revenue-enhancing capital expenditures, and leasing costs. Costs related to ground-up development or first time conversion of non-laboratory space to laboratory space through redevelopment are excluded from non-revenue-enhancing capital expenditures.

Operating statistics

We present certain operating statistics related to our properties, including number of properties, RSF, occupancy percentage, leasing activity, and contractual lease expirations as of the end of the period. We believe these measures are useful to investors because they facilitate an understanding of certain trends for our properties. We compute the number of properties, RSF, occupancy percentage, leasing activity, and contractual lease expirations at 100% for all properties in which we have an investment, including properties owned by our consolidated and unconsolidated real estate joint ventures.

Cover Page	Jul. 13, 2023
Cover [Abstract]
Entity Central Index Key	0001035443
Amendment Flag	false
Document Type	8-K
Document Period End Date	Jul. 13, 2023
Entity Registrant Name	ALEXANDRIA REAL ESTATE EQUITIES, INC.
Entity Incorporation, State or Country Code	MD
Entity File Number	1-12993
Entity Tax Identification Number	95-4502084
Entity Address, Address Line One	26 North Euclid Avenue
Entity Address, City or Town	Pasadena
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	91101
City Area Code	626
Local Phone Number	578-0777
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, $.01 par value per share
Trading Symbol	ARE
Security Exchange Name	NYSE
Entity Emerging Growth Company	false