Merck Sells New Jersey Headquarters Campus to Onyx Equities JV
Global healthcare company Merck Sharp & Dohme, LLC recently announced the sale of its campus in Kenilworth, N.J., to a joint venture between real estate investment and property services firm Onyx Equities, LLC and real estate investment platform Machine Investment Group, LLC. According to statements made regarding the sale, this transaction represents one of the largest office and life sciences deals in the state’s history.
The property includes nearly 2 million square feet of biologics, research, and development space across 108 acres. In addition to more than 1.4 million square feet of laboratory space, the campus also includes 500,000 square feet of Class A New Jersey office space; three full-service cafeterias; a fitness center; auditoriums and conference centers; outdoor amenity areas; more than 3,200 surface and structured parking spaces; 30 acres of developable land; and a 25-megawatt cogeneration plant.
Located at 2000 Galloping Hill Road, the campus boasts a premier location at a direct interchange off the Garden State Parkway at Exit 138. The location’s superior accessibility also includes proximity to Route 78, the Route 22 retail corridor, the New Jersey Turnpike, Newark Liberty International Airport, and the Port Newark Elizabeth Marine Terminal.
Merck will remain a tenant at the Kenilworth property for the next several years as it prepares its phased relocation.
Returning to Rahway
In April 2020, Merck announced that it had decided to consolidate its New Jersey campuses into a single location in Rahway, thereby returning to the company’s original birthplace in the U.S. after 40 years. Preparation was already well underway in May of last year, when the company announced it was putting the Kenilworth campus up for sale.
The Rahway campus, located along Route 1 and East Scott Avenue, opened in 1903. During its 120 years of history, the original Rahway site has grown from one manufacturing plant to more than 200 acres that made room for breakthrough scientific discovery and development.
“In what I consider to be a major accomplishment for our city, Merck & Co. — which is already one of our largest employers — announced that its global headquarters will return to Rahway after an almost 40-year absence,” Rahway Mayor, Raymond Giacobbe, said. “This will result in hundreds of new jobs coming to our city; new customers for our businesses; and additional development on the Merck campus, including the construction of a 5,000-square-foot welcome center.”
A New Era for Life Sciences in Kenilworth
The new owners of the Kenilworth campus have expressed their intention to market the site’s state-of-the-art laboratories and support facilities to biotechnology, pharmaceutical, and technology companies. That’s because these organizations appreciate the value of the highly educated local life sciences labor pool, as well as the excellent access to regional infrastructure and thoroughfares.
“The life sciences industry is surging, and its rapidly developing technology requires new specialty facilities,” said John Saraceno Jr., co-founder and managing principal for Onyx. “The Merck campus represents an opportunity to host blue-chip companies that will benefit from proximity to New Jersey and New York’s highly educated workforce. We’re excited to apply Onyx’s unique asset repositioning platform to attract the next generation of life sciences and technology leaders.”
Likewise, Mayor of Kenilworth, Linda Karlovitch, expressed confidence in the positive potential of the change in ownership.
“I would like to thank everyone involved for doing their due diligence and exploring all possible options to achieve this goal regarding the sale of the Merck property,” she said. “I was happy to work with Merck during this process and I am pleased that a qualified and suitable buyer was chosen. I believe this will secure the future of Kenilworth, ensuring equity and stability for our borough. Kenilworth looks forward to welcoming and working with the new buyers of the property.”
Merck’s Global Real Estate Lead, Shefali Shah, also delivered statements regarding future possibilities for a new life sciences hub in New Jersey.
“This collaboration is an incredible opportunity to help reimagine the hub of life sciences, while also continuing Merck’s strong history and legacy of serving patients and communities,” Shah said. “We believe Onyx Equities, LLC will foster long-term value, economic growth, and sustainability within the community. We look forward to collaborating with Onyx Equities, LLC and their team members on a smooth transition.”
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