Real estate and life sciences: time to grow, but is there space?

Kate Corke, partner and Christina Tennant, senior counsel at Farrer & Co, provide an Expert View on real estate for the UK’s life sciences sector.

Life sciences and pharmaceuticals have never been more important. With the pandemic heralding increased interest in the sector along with a demand for ‘home grown’ vaccines post-Brexit, it is no surprise that a Knight Frank study revealed that 2020 saw the value of life sciences IPOs increase fourfold on 2019. Indeed, 2021 saw venture capitalists further increase their funding in UK life sciences.

While this capital is set to build greater capacity and drive growth, finding a space in which to grow can be challenging for UK life sciences businesses. The preference to be in knowledge clusters within the ‘golden triangle’ of London, Oxford and Cambridge, coupled with the highly technical specifications of the properties and their bespoke fit-outs, drastically increase initial costs, presenting challenges to investors and occupiers alike. Indeed, Savills notes there is, on average, a time delay of 12 to 18 months between capital raised for the sector and real estate demand.