Alexandria Real Estate Equities, Inc. (ARE) Stock Analysis

Alexandria Real Estate Equities (ARE) holds a defensible position as the leading owner, operator, and developer of life science real estate in the U.S., with a focus on “Megacampus” clusters in top innovation markets such as Boston, San Francisco, and San Diego. As of March 2025, 75% of annual rental revenue and 71% of operating square footage derive from these campus-style assets, which consistently achieve higher occupancy (95% vs. 91% for non-Megacampus properties) and command premium rents.

ARE’s tenant roster is notably resilient: 87% of top 20 tenant revenue comes from investment-grade or large-cap public companies, and no single tenant exceeds 4.3% of annual rent. Weighted-average lease terms are long (9.6 years for top tenants), and 98% of leases include annual rent escalations, supporting stable, growing cash flows.

Compared to office REIT peers such as Boston Properties and Healthpeak, ARE’s sector focus and deep relationships with life science tenants yield lower vacancy, higher renewal rates, and less exposure to remote work risk. The company’s development pipeline, balance sheet strength (net debt/EBITDA 5.9x, 12.2-year average debt maturity), and experienced management further reinforce its moat. However, ARE faces rising capital costs and potential tenant funding headwinds, which could pressure development returns if life science funding remains soft.