The real estate challenges, opportunities Houston faces as hub for biotech, according to expert

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Houston's access to lab space continues to be a challenge for biotech companies. Photo via Getty Images

In the decade prior to COVID, when it came to early stage biotech companies establishing a foothold in Houston, space-wise, there were only a handful of options to choose from. Because of specialized equipment needs, including in many cases, the requirement for vent hoods, multiple sinks, and 24/7 air-conditioned space, traditional flex type projects were not a ready-made option. UH’s Technology Bridge offered those amenities, and while it worked for some, it was not intended as a permanent business home. Most emerging biotech firms found space that was a partial fit, and modified it to work (at their cost).

Houston’s Rise on the National Stage

For a variety of reasons, including its broad talent pool, lower cost of operations, and more favorable business climate, Houston has continued to attract biotech companies from other states. Following on the heels of new and expanding life science firms, and a supportive ecosystem, investor interest in building and purchasing properties to meet their specialized requirements has been a natural result. Unlike traditional office occupiers, lab users need physical space, and are not candidates for a hybrid or work from home model.

TMC Proximity Premium

Land costs inside Loop 610 have historically trended higher than suburban alternatives. For this reason, the newest projects completed near TMC like Helix Park and the planned Bioport are focused on much larger firms and institutions with the ability to commit to a long lease term and pay a premium rent. A second tier of real estate investors has also entered the market, however, purchasing nearby 80’s vintage projects, upgrading them, and repurposing the space to meet demand from mid-size or less creditworthy biotech companies. Existing small to mid-size tenants currently housed in these projects can expect to see bumps in both rent and expenses.

As an alternative to close-in options, but within a reasonable drive of the TMC, Pearland, Sugar Land and Stafford have increasingly become a location choice for biotech firms. Pearland’s EDC has targeted life science companies needing custom-built manufacturing facilities with economic incentives for some time. Lonza, Merit Medical, and formerly St. Paul-based Cardiovascular Systems are just three recent examples touted on their website.

Planning for Affordable Lab Space Options

Management teams for early stage companies are stretched thin, and are not always prepared for the time and money it takes to find and equip office/lab space.

Not all suburban landlords want to incur the sizeable costs for a customized build out, which can range between $40 and $200 per square foot. Entrepreneurs are also surprised by the 4-6 months of lead time it typically takes to identify space options, negotiate a lease, and permit and build the improvements (including the unexpected costs of bringing an older project in compliance with current energy and building codes).

However, with realistic expectations about these challenges, the good news is that once settled into a facility that is a fit, Houston’s emerging biotech companies can thrive and grow.

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Julie King is President of NB Realty Partners. She has mentored and provided commercial real estate advice to technology, biotech, and early-stage companies for over 23 years.

What guest articles trended this year on InnovationMap in 2019? Photo by PeopleImages

Top 5 Houston innovation guest columns of 2019

2019 IN REVIEW

Editor's note: InnovationMap is Houston's only news source and resource about and for startups, and some of this year's top stories were penned — or, more realistically, typed — but the Houston innovation community itself. As we get ready for 2020, let's see what guest columns were most read in 2019.

How technology is disrupting — and improving — the real estate industry in Texas

Buying a home is more digitized than ever — and here's how that's affecting the industry. Photo courtesy of HAR

A recent lawsuit is rocking the residential real estate industry across the country. Home sellers whose properties were listed on one of 20 MLSs claim The National Association of Realtors, Realogy Holdings Corp., HomeServices of America, RE/MAX Holdings, Inc., and Keller Williams Realty, Inc. violated the federal antitrust law by conspiring the sellers to pay an inflated amount to the buyer's broker.

The lawsuit highlights a new need for home buyers and sellers: transparency. Gone are the days when real estate agents can take a hefty commission from his or her clients without providing value that is worthy of the price tag. The sellers who came forward to shed light on this issue have provided further proof that the current real estate model is outdated, and some serious changes could be on the way. Continue reading.

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Alex Doubet is the founder and CEO of Door, Inc. (Door.com), which is a residential real estate startup company based in Texas.

Why it's important for Texas startups to get funding within the Lone Star State

Texas startups should be getting funded with Texas money, and here's why. Getty Images

When you set out to disrupt a long-standing industry, one of the most important aspects is figuring out where you are going to get the money. Odds are, you are going to be OK with breaking the mold on other traditional practices such as forgoing the venture capitalist firms for smaller companies who share your innovative vision and want to invest in it.

That philosophy works well in Texas seeing as the big venture capitalists tend to stay on the East and West Coasts.

There are dozens of things to think about when starting a company. Funding can be the most important, and there are many ways to approach raising funding for your startup. Here are a few things to consider. Continue reading.

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Alex Doubet is the CEO and founder of Door Inc., a Texas-based, tech-infused real estate platform.

Houston expert shares her advice on how much startups should spend on marketing

When it comes to setting up a marketing budget for your startup, considering every angle is important. Getty Images

Industry research suggests spending 5 percent to 12 percent of total revenue on an annual marketing budget. At Integrate Agency, we believe marketing spend should be determined from key data points, versus current size. We shepherd our clients through a five-step process to calculate how much they should spend on marketing to maximize their ROI. Continue reading.

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Allie Danziger is the founder and president of Houston-based Integrate Agency, which focuses on digital marketing and public relations.

Finding lab space for startups and independent researchers in Houston needs to be easier, according to this expert

Rentable lab space is hard to come by. Getty Images

Finding coworking space is getting easier and easier for startups, but the same can't be said for startups looking for lab space. If Houston wants to continue to grow and develop its innovation ecosystem — specifically within research and development in the health sciences industry — the city needs more opportunities for small lab space real estate. Continue reading.

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Julie King is president of NB Realty Partners. She has mentored and provided commercial real estate advice to technology, biotech, and early-stage companies for over 20 years.

New technology gives this Houston hospital a competitive edge

A new prostate cancer treatment at Houston Methodist is enhancing the system's patient care. Getty Images

As the top ranking hospital in Texas and one of the biggest employers in Houston, Houston Methodist Hospital is poised to treat the thousands of Texan men who will be diagnosed with prostate cancer this year.

Building on its legacy of delivering advanced cancer treatment, the healthcare giant is one of the first hospitals in the United States to offer men a benign approach to treating localized prostate cancer, using high intensity focused ultrasound, or HIFU. HIFU is a minimally invasive procedure that allows patients to maintain their quality of life with potentially fewer side effects. Continue reading.

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Brian Miles, M.D, is a practicing urologist and professor of urology at the Institute for Academic Medicine at Houston Methodist.

Rentable lab space is hard to come by. Getty Images

Finding lab space for startups and independent researchers in Houston needs to be easier, according to this expert

Lab space race

Finding coworking space is getting easier and easier for startups, but the same can't be said for startups looking for lab space. If Houston wants to continue to grow and develop its innovation ecosystem — specifically within research and development in the health sciences industry — the city needs more opportunities for small lab space real estate.

A little history

Houston has increasingly become a magnet for innovative life science companies, seeking to benefit from the Texas Medical Center's cadre of connections and the city's deep talent pool. While cutting edge research and licensed technology has long been a part of the TMC institutions and Houston landscape, until 2016, independent lab users had few options to start and grow their companies.

In March of 2016, JLabs at TMCx opened its doors, offering 34,000 square feet of shared office space, 22 private labs and two shared lab spaces. University of Houston's Innovation Center, located in a repurposed Schlumberger campus, began operation in September of the same year, offering 16 private labs and two shared lab spaces.

These two alternatives are fit out with benches and other specialized equipment and price their space similar to a furnished coworking model. However, both facilities have a preference for certain users.

In the case of UH's space, its priority is to accommodate companies that are licensing and commercializing university technology. JLabs also has a curated tenant pool — drawn from the local and national companies that fit their specific profile. Sharing lab space is not a fit for every company — especially those that are regulated or prohibited from doing so. What appears to be an unmet need is affordable independent lab space for companies ready to launch from shared space.

Unique requirements

Aside from equipment that must be purchased and installed, lab users require more electrical power, plumbing, and air-conditioning than typically found in available suites in independent office parks. Second generation lab space under 2,000 square feet is extremely hard to find, and traditional landlords prefer a 5-year lease commitment.

While several new projects have been announced — and a new crop of landlords are trying to capitalize on the city's increased demand for specialized space — their pricing model is a better fit for established companies. From a user perspective, given the capital constraints of early stage life science companies, it is worth exploring the option to convert traditional warehouse space for lab use in exchange for a medium term commitment.

Buyer beware

Migrating from a full service lab to an independent suite does come with a warning, however, especially if a company is regulated and the condition of the space is subject to inspection. Lab tenants are well advised to factor in issues like the age of the air-conditioning units, whether a future backup power source is permitted, and the method for removal of medical waste. For firms that are in the pre-revenue stage, they should also be prepared to pay some amount of prepaid rent and the cost of customized alterations.

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Julie King is president of NB Realty Partners. She has mentored and provided commercial real estate advice to technology, biotech, and early-stage companies for over 20 years.

Sharing common space or having a glass-wall office might not be ideal for your company. Getty Images

3 things to consider before investing in coworking space for your company

Pros and cons

While coworking is an established trend in many of the nation's larger metropolitan areas, the innovative approach to office space has been slower to gain momentum in Houston from a tenant's perspective, making up less than 1 percent of the city's total inventory of office space.

Coworking has tended to appeal to startups and one- or two-person consulting firms and is currently available in Houston in various forms and price points. Nationally branded WeWork and Techspace offer an amenity-rich and more expensive option geared toward corporate clients, while other coworking providers, like Station Houston and The Cannon, have targeted tenants seeking connections to investors and mentors.

Coworking options can now be found in many parts of Houston. Office landlords are even converting portions of their buildings to coworking suites to meet increased demand.

Before you invest in this new type of office space, consider the following aspects that come with coworking space.

1. Flexibility is the key driver
From a user experience point of view, coworking has both advantages and disadvantages. Flexibility and price are the key elements. In contrast to multiyear year lease terms required by traditional landlords, coworking is a shorter commitment. Terms of six to 12 months for fully furnished offices are the norm, but month-to-month leases are also common. Rent is calculated based on a per-person model, compared to the rent-per-square-foot structure of a traditional office or warehouse lease.

For a one-person company or a small team, sharing a kitchen and conference room can be well worth the lower monthly rent expense, ranging between $800 and $2,000 per month. Touch and go memberships are also available at most coworking locations, providing access to the common areas for a typical monthly fee of less than $200, but without the benefits of a private office. However, as companies scale up and grow, the per-person model for rent begins to make less economic sense.

2. Beware of the add-ons
Coworking typically provides shared use of conference rooms with a monthly allocation of time for each tenant. Some offer beer, coffee, and social and networking events, and a few even permit dogs. It is important to read the fine print of the agreements and be prepared to pay additional charges for extra amenities not included in the monthly rent — everything from garage parking to fees for internet, furniture rental, snacks, and kitchen use.

3. Privacy and identity
Sharing a glass-walled team office with coworkers and taking private calls in a shared space is not the right fit for every company. For some firms, their critical objective is a work environment that reflects company brand, culture, or professional image — a feature not necessarily offered with coworking.

However, as Houston has witnessed changing work patterns, commute issues, and the importance of work-life balance, our city has responded and can now offer many more flexible workspace options.

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Julie King is president of NB Realty Partners. She has mentored and provided commercial real estate advice to technology, biotech, and early-stage companies for over 20 years.

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Texas booms as No. 3 best state to start a business right now

Innovation Starts Here

High employment growth and advantageous entrepreneurship rates have led Texas into a triumphant No. 3 spot in WalletHub's ranking of "Best and Worst States to Start a Business" for 2026.

Texas bounced back into the No. 3 spot nationally for the first time since 2023. After dropping into 8th place in 2024, the state hustled into No. 4 last year.

Ever year, WalletHub compares all 50 states based on their business environment, costs, and access to financial resources to determine the best places for starting a business. The study analyzes 25 relevant metrics to determine the rankings, such as labor costs, office space affordability, financial accessibility, the number of startups per capita, and more.

When about half of all new businesses don't last more than five years, finding the right environment for a startup is vital for long-term success, the report says.

Here's how Texas ranked across the three main categories in the study:

  • No. 1 – Business environment
  • No. 11 – Access to resources
  • No. 34 – Business costs

The state boasts the 10th highest entrepreneurship rates nationwide, and it has the 11th-highest share of fast-growing firms. WalletHub also noted that more than half (53 percent) of all Texas businesses are located in "strong clusters," which suggests they are more likely to be successful long-term.

"Clusters are interconnected businesses that specialize in the same field, and 'strong clusters' are ones that are in the top 25 percent of all regions for their particular specialization," the report said. "If businesses fit into one of these clusters, they will have an easier time getting the materials they need, and can tap into an existing customer base. To some degree, it might mean more competition, though."

Texas business owners should also keep their eye on Houston, which was recently ranked the 7th best U.S. city for starting a new business, and it was dubbed one of the top-10 tech hubs in North America. Workers in Texas are the "third-most engaged" in the country, the study added, a promising attribute for employers searching for the right place to begin their next business venture.

"Business owners in Texas benefit from favorable conditions, as the state has the third-highest growth in working-age population and the third-highest employment growth in the country, too," the report said.

The top 10 best states for starting a business in 2026 are:

  • No. 1 – Florida
  • No. 2 – Utah
  • No. 3 – Texas
  • No. 4 – Oklahoma
  • No. 5 – Idaho
  • No. 6 – Mississippi
  • No. 7 – Georgia
  • No. 8 – Indiana
  • No. 9 – Nevada
  • No. 10 – California
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This article originally appeared on CultureMap.com.

Houston lab-test startup seeks $1M for nationwide expansion

Testing Access

Health care industry veteran Jim Gebhart knew there had to be a better way for patients to access lab services, especially those with high health insurance deductibles or no insurance at all.

“This challenge became deeply personal when a close family member developed a serious illness, and we struggled to secure prompt appointments,” Gebhart tells InnovationMap. “It’s incredibly frustrating when a loved one cannot receive timely care simply because of provider shortages or the limited capacity of traditional clinics.”

Driven by the desire to knock down lab-test barriers, Gebhart founded Houston-based TheLabCafe.com in 2024. The platform provides access to low-cost medical tests without requiring patients to carry health insurance. TheLabCafe serves patients in six states: Texas, Georgia, Louisiana, Nevada, New Mexico and Oklahoma. Gebhart, the startup’s CEO, says that by the end of March, LabCafe will be offering services in 20 more states and the District of Columbia.

Gebhart has spent more than 30 years in the lab industry. His career includes stints at Austin-based Clinical Pathology Laboratories, Ohio’s Cleveland Clinic Laboratories and Secaucus, New Jersey-based Quest Diagnostics.

“Since nearly 80 percent of disease diagnoses rely on laboratory testing, I decided to leverage my background to create a more accessible, self-directed process for individuals to order blood and urine tests on their own terms — when and where they need them,” says Gebhart.

So far, Gebhart is self-funding the startup. But he plans to seek $700,000 to $1 million in outside investments in late 2026 to support the nationwide expansion and the introduction of more services.

TheLabCafe contracts with labs for an array of tests, such as cholesterol, hepatitis, metabolic, testosterone, thyroid and sexually transmitted infection (STI) tests. A cholesterol test obtained through TheLabCafe might cost $29, compared with a typical cost of perhaps $39 to $59 without insurance.

A health care professional reviews every test, both when the test is ordered and when the results are delivered, often within 24 hours. After receiving test results, a patient can schedule a virtual visit with a health care professional to go over the findings and learn potential treatment options.

Gebhart says TheLabCafe particularly benefits uninsured patients, including those in Texas. Among the states, Texas has the highest rate of uninsured residents. U.S. Census Bureau data shows 21.6 percent of adults and 13.6 percent of children in Texas lacked health insurance in 2024.

“Uninsured patients often pay the highest prices in the health care system,” Gebhart explains. “We address this by offering straightforward pricing and convenient access to testing without requiring insurance.”

“Our rates are intentionally set to remain affordable, helping individuals take a proactive approach to their health,” he adds. “Regular testing enables people to identify potential health issues early and track their progress as they make lifestyle changes. Ultimately, you can’t measure improvement without data — and laboratory results provide that data.”

Houston geothermal startup secures $97M Series B for next-gen power

fresh funding

Houston-based geothermal energy startup Sage Geosystems has closed its Series B fundraising round and plans to use the money to launch its first commercial next-generation geothermal power generation facility.

Ormat Technologies and Carbon Direct Capital co-led the $97 million round, according to a press release from Sage. Existing investors Exa, Nabors, alfa8, Arch Meredith, Abilene Partners, Cubit Capital and Ignis H2 Energy also participated, as well as new investors SiteGround Capital and The UC Berkeley Foundation’s Climate Solutions Fund.

The new geothermal power generation facility will be located at one of Ormat Technologies' existing power plants. The Nevada-based company has geothermal power projects in the U.S. and numerous other countries around the world. The facility will use Sage’s proprietary pressure geothermal technology, which extracts geothermal heat energy from hot dry rock, an abundant geothermal resource.

“Pressure geothermal is designed to be commercial, scalable and deployable almost anywhere,” Cindy Taff, CEO of Sage Geosystems, said in the news release. “This Series B allows us to prove that at commercial scale, reflecting strong conviction from partners who understand both the urgency of energy demand and the criticality of firm power.”

Sage reports that partnering with the Ormat facility will allow it to market and scale up its pressure geothermal technology at a faster rate.

“This investment builds on the strong foundation we’ve established through our commercial agreement and reinforces Ormat’s commitment to accelerating geothermal development,” Doron Blachar, CEO of Ormat Technologies, added in the release. “Sage’s technical expertise and innovative approach are well aligned with Ormat’s strategy to move faster from concept to commercialization. We’re pleased to take this natural next step in a partnership we believe strongly in.”

In 2024, Sage agreed to deliver up to 150 megawatts of new geothermal baseload power to Meta, the parent company of Facebook. At the time, the companies reported that the project's first phase would aim to be operating in 2027.

The company also raised a $17 million Series A, led by Chesapeake Energy Corp., in 2024.

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This article originally appeared on our sister site, EnergyCapitalHTX.com.

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