Real Estate Mogul Brian O’Neill’s Big Health-Care Bet
The developer known for his outrageous ambition is stepping into the world of cell and gene therapy. But with this new venture, he’ll try to balance purpose and profit, for legacy’s sake.
Brian O’Neill doesn’t bet small. Nearly every venture the Philadelphia real estate magnate has pursued over his 30-year career was once deemed too big, too expensive, or, in some cases, just too outrageous to get done. More than a few of those projects have caved under the weight of O’Neill’s blind ambition. But he still embraces big vision.
Unconventional habits, like reading five newspapers before 5 a.m. every morning and doggedly recruiting some of the world’s leading talent — O’Neill once pursued a health-care administrator for four years until she finally joined his team — have sharpened his knack for making investments in the right places at the right time. As O’Neill explains it, it’s about envisioning an enormous goal and working backwards, filling in the details as he inches closer to a project’s completion.
“I call it end-back analysis,” he says as we sit in his King of Prussia office. “If in the end I want to have a $23 million company that spans four continents and treats 50 million people, I have to start with that vision and work my way back to today’s point and map out all those pieces. As we bring on management and doctors and scientists, we show them that map, and they fill in the blanks.”
Now, in perhaps his loftiest pursuit yet, O’Neill has set his sights on Philadelphia’s latest boom: cell and gene therapy.
In collaboration with New York City-based health-care investment firm Deerfield Management, O’Neill plans to raise $1.1 billion to develop a 680,000-square-foot cell and gene therapy manufacturing facility on the site of his 1.6 million-square-foot Discovery Labs innovation hub in King of Prussia. O’Neill has named it the “Center for Breakthrough Medicines” — a hub for discovery and manufacturing that he claims will someday enable scientists to save as many as 200 million lives.
O’Neill’s proposed development is a bet on local researchers who have already proven to be pioneers in developing groundbreaking therapies that help the human body’s own cells and genes destroy disease. The first FDA-approved gene therapies, for the treatment of a rare, inherited form of retinal blindness and the treatment of a form of acute lymphoblastic leukemia, were developed jointly by researchers at the Children’s Hospital of Philadelphia and the University of Pennsylvania. All that stands in the way of local innovators and their next breakthrough therapy is real estate.
O’Neill joins a cadre of investors and more than 30 gene and cell therapy firms in the region hoping to build their way out of Philadelphia’s lab-space shortage. The Real Estate Solutions Group and CBRE Group, two commercial real estate consulting firms, estimate that there’s a two percent lab vacancy rate in University City and little space elsewhere in the city to expand. O’Neill’s center could be a boon not only for patients and the biotech companies looking to scale, but also for the region, which stands to see robust economic gain from the project. O’Neill expects to hire 2,000 employees over the next two years, most of whom will work at the King of Prussia site.
“If Brian is able to make the $1.1 billion cell and gene manufacturing facility a reality, it would be a significant catalyst for the already burgeoning Philadelphia life-science ecosystem.”
“If Brian is able to make the $1.1 billion cell and gene manufacturing facility a reality,” says Lawrence Stuardi, chief executive officer and president of real estate development firm MRA Group, “it would be a significant catalyst for the already burgeoning Philadelphia life-science ecosystem. It would be good for everyone, particularly medical patients, who will be the prime beneficiaries.” MRA is currently refurbishing a suburban hub of labs at Spring House Innovation Park and overseeing the impending opening of 70,000 square feet of lab and office space at the Pennovation Works campus in Grays Ferry.
But whether O’Neill can pull off what he calls one of the most important pursuits of his career is muddied by a complicated record.
People who know O’Neill tend to describe him as having vastly different personalities depending on when they first met him. Some who knew him before 2008 describe him as predictably unpredictable — one moment he’d be engaged in an expletive-laden rant; the next, he’d be smiling and giving a compliment. Some have called this “old Brian” boastful, perhaps because they heard him brag about the luxuries he enjoyed at the peak of his career in the early 2000s. Back then, he managed a purported $4 billion portfolio of properties and traveled by private jet.
But before his rise to real estate fame, O’Neill was known as an underdog, a rebel with big dreams. Growing up alongside five brothers, he was kicked out of one high school and later dropped out of another before a disagreement with his father forced him out on his own at age 14.
Then there were his early days in business, when he slept in a car while struggling to establish himself in real estate. Driven in part by a desire to attract the adoration of Miriam Polillo, now his wife of 35 years, he also wanted to prove to his entrepreneurial father, who owned a restaurant and inn, that he could be successful.
O’Neill founded O’Neill Properties Group in 1988 and quickly became infamous for scooping up what were generally regarded as useless parcels of land — abandoned industrial, manufacturing, mining and brownfield sites — and converting them into profitable luxury residential, commercial and retail properties. Just a few years after establishing O’Neill Properties, he inked a $14.5 million deal for a 720,000-square-foot former tire factory in Whitemarsh Township — a property he later converted into mixed-use industrial and office space. In the decades that followed, O’Neill developed numerous neighborhood-altering projects, including the Corinthian luxury condominiums in Bala Cynwyd; the Royal Belmont near Cambridge, Massachusetts; and luxury apartment complexes the Royal Athena, in Bala Cynwyd, and the Royal Worthington, in Malvern.
But not every O’Neill project was a success. In 2004, he purchased an old rock quarry in Bala Cynwyd with plans to erect a mixed-used development on Rock Hill Road and help transform the otherwise neglected former industrial zone. After a groundbreaking, the property sat untouched for nearly a decade until it was sold.
The stock market crash of 2008 dealt O’Neill Properties a heavy blow.
“The recession devastated my business,” O’Neill says. “When you’re rolling along and everything’s going fine, you believe you’re infallible. But this recession, not just for me but for a lot of people in the world, was devastating.”
Within days of the crash, O’Neill says, his company went from hiring hundreds of employees to managing multiple rounds of layoffs. And he went from careless living to pondering the meaning of life itself. Today, many of his properties, once big visions in O’Neill’s mind, have gone up for sale. People who have gotten to know him over the past decade or so believe a “new Brian” emerged after the loss.
“It really got me thinking about the legacy I want to leave,” Brian O’Neill says. “I started thinking, how can I invest with a purpose and not just for the sake of building my business?”
“It really got me thinking about the legacy I want to leave,” he says. “I started thinking, how can I invest with a purpose and not just for the sake of building my business?” This question led to a noticeable shift in O’Neill’s focus. Instead of erecting another luxury tower or country club, O’Neill in 2012 put his money and network behind an effort called Faith in the Future. With his support, the nonprofit foundation raised $12 million to keep 17 Catholic high schools in the Philadelphia region open at a time when at least four of the schools were in danger of being shuttered.
Two years later, amid an expanding national opioid crisis, O’Neill established the Recovery Centers of America, a chain of private, for-profit luxury addiction treatment centers with locations across Maryland, Massachusetts, New Jersey and Pennsylvania. RCA was born with the goal of helping “one million patients achieve a life of recovery” in less than a decade. O’Neill’s RCA vision was ambitious, to say the least.
In 2017, an investigation by the Boston Globe and its health-care news site STAT led the state department of public health to suspend admissions at one of RCA’s inpatient addiction treatment centers in Massachusetts, citing “concerns regarding patient care and safety.” The closure came after numerous reports of subpar care and poor supervision of patients that purportedly resulted in covert sex and other illicit behavior among the center’s patients. Massachusetts opened its own investigation after two patients died in the facility.
Despite the very public failures, O’Neill insists RCA is more than capable of meeting its original goal of healing a million addiction patients. The company still has quite a way to go. In the three and a half years that RCA has been fully operational, it’s treated a little more than 60,000 patients. According to O’Neill, it’s on track to treat 40,000 more by the end of 2020. He anticipates doubling that number in the year 2021, and upward from there.
“With our current growth rate, we could meet our goal inside of 10 years,” O’Neill says matter-of-factly.
O’Neill is moving fast with the Center for Breakthrough Medicines. He predicts the hub, which broke ground in December 2019, will be fully operational and occupied by the end of 2021. O’Neill’s team will need to move fast in fund-raising from willing investors and in construction, not to mention in convincing enough right-sized cell and gene therapy companies to choose its suburban site over equally enticing spaces in development.
O’Neill says his MLP Ventures team, which oversees Discovery Labs, has more than enough interested tenants: “We’ve gotten 500 inquiries for business. It’s divided between small companies where we’ll be doing all the early discovery work for them and large companies who need commercial manufacturing.” Just two large clients, he notes, could take all the space.
One of the sector’s biggest players, Spark Therapeutics, is in the market for space but wouldn’t comment on whether it’s considering O’Neill’s development. Century Therapeutics, another major player, recently committed to multiple floors at the Cambridge Innovation Center (CIC) in University City. Carisma Therapeutics, an early-stage biotechnology company operating out of the fully occupied BioLabs space at CIC, is poised for rapid growth and is considering the suburban center.
O’Neill envisions the King of Prussia site as just one of at least four similar centers he wants to develop, with others in California, the U.K. and Asia. His backward race toward another bold new vision has begun.
Lawrence Stuardi believes O’Neill can get it done. “Big outcomes require big vision, and Brian has proven he’s not lacking in vision,” he says. “Real estate development, especially with a project like what he has proposed, is rife with huge obstacles. He’s been at this juncture before, so I’m confident he knows what he’s facing.”
Despite the unknown challenges ahead, O’Neill seems optimistic. The boisterous “old Brian” seems to have succumbed to humility. He rarely mentions his fortune, the treasures he’s lost, or how much he stands to gain if this venture is successful. These days, he talks more about his five children — three of whom have worked with him in some capacity — and his wife, who, he proudly notes, serves as the chairperson of all his companies. He also talks more about the legacy he hopes to leave behind.
“Everything I’ve done in life has led to this point, and everything I’ve done in life pales in comparison to this, because of the potential impact on humanity,” he says. “In the past, I’ve lived in fear that if I died tomorrow, I’d have to ask, ‘Did I really give my all and leave it all out on the field?’ I think if I can get this done, that would be as close to a ‘yes’ as you can get.”
Published as “Brian O’Neill’s Big Health-Care Bet” in the April 2020 issue of Philadelphia magazine.