Demand for life sciences-related space across the Golden Triangle remained strong during the first quarter of 2023, the most recent research from Knight Frank has shown.
According to the figures, almost 150,000 sq ft of life sciences-related workspace was transacted during the first three months of the year, which is more than double the circa 66,000 sq ft reported for the first quarter of 2022.
Q1 2023 life sciences lab take-up in the Golden Triangle totalled 86,876 sq ft, while life sciences office take-up in the region totalled 62,277 sq ft over the same period.
Key leasing deals included New England Biolabs signing for a 30,000 sq ft manufacturing and product development facility at Milton Park in Oxfordshire, and ADC Therapeutics expanding at the I-Hub in White City, W12, taking an additional 12,000 sq ft.
Despite this increase, Knight Frank noted that take-up figures in the Golden Triangle are still constrained by a lack of available space, which is likely to be further exacerbated by the continued growth of the sector in the coming years.
The report pointed to a record 283 new life sciences companies being formed in the UK during the first three months of 2023. Knight Frank said it expects many of the new firms to target the office and lab markets across the Golden Triangle, further constraining available supply.
Investment
Knight Frank said more than £496m was invested into life sciences-focused real estate in the area spanning London, Cambridge and Oxford in the three months to 31 March 2023. This made it the highest Q1 investment total on record for the sector and the best quarter for investment since Q4 2021.
London represented the largest share of investment activity in the Golden Triangle, making up 79% of the total.
Notable deals during the period included GIC and Oaktree’s £100m purchase of 17 Columbus Courtyard in Canary Wharf, E14. In addition, GIC, BlackRock Alternatives and British Airways’ New Airways Pension Scheme have joined forces to develop 443,000 sq ft of lab space at Tribeca in King’s Cross, NW1, in conjunction with Reef Group.
Emma Goodford, head of life sciences and innovation at Knight Frank, said: “The UK life sciences sector is in a period of growth, attracting capital from a range of sources including sovereign wealth funds, public pension plans and private equity, as well as venture capital. The government’s science strategy and a public awareness of the importance of life sciences research and development post-pandemic is driving the formation of new entrants and spurring the market’s long-standing operators to new heights.
“While it is encouraging to see the government prioritise the UK’s potential as a leading global hub for life sciences, it is critical that more is done to incentivise the development and repositioning of life sciences lab and office space if the sector is to capitalise on, and keep pace with, record levels of demand. Equally important is the experienced capital to support the scaling of some businesses in the sector now experiencing rapid growth.”
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