Capital One closed a $36 million loan to finance the acquisition of a lab-capable office campus in San Diego by BioMed Realty, a Blackstone portfolio company.

Funding includes a holdback for the redevelopment of office space as laboratory/life science suites.

“We were able to leverage our expertise in healthcare and life science to structure the loan to allow the conversion over the loan term,” said Erik Tellefson, managing director, Capital One Healthcare. The two-year interest-only adjustable rate loan has three one-year extensions.

The two properties, totaling approximately 123,000 square feet, are located in the Sorrento Mesa life science submarket of San Diego, one of the largest biotech clusters in the nation. Once renovations are complete, the buildings will consist of state-of-the-art office/lab spaces designed for flexible use of space. The buildings will also offer ample parking and a fitness center.

Blackstone is one of the world’s largest investment firms with over $430 billion of assets under management in the United States, Europe, Asia, and Latin America. In 2016, Blackstone acquired BioMed Realty, the second-largest commercial owner and operator of high-quality life science real estate comprising 11 million square feet in the leading innovation markets throughout the United States and United Kingdom.

“We appreciate Capital One’s responsive execution,” said Denis Sullivan, executive vice president and chief investment officer of BioMed Realty. “Their financing solution dovetails with our business plan for these specific assets while furthering our long-term goal of expanding our portfolio footprint in the San Diego core market.”

Capital One Healthcare provides financial services to customers across healthcare sectors — including senior housing, healthcare services, pharmaceuticals, medical devices, healthcare IT and medical offices.