TLDR:
- The UK’s life science real estate leasing market is in good shape, with venture capital investment on the rise.
- Demand is high across the Golden Triangle, but some developers are facing challenges leasing up schemes.
The UK’s life science real estate leasing market is experiencing a surge in venture capital investment, with demand far outweighing supply. The market in the Golden Triangle is particularly robust, with about 1.7M SF in demand and only 400K SF available. However, some developers are finding it challenging to lease out their schemes, especially in areas like Oxford where completed projects are testing the “build it and they will come” strategy.
In the first quarter, life sciences lab takeup in the Golden Triangle was 169K SF, slightly below the previous quarter but still above the Q1 average. The industry is grappling with the dilemma of what type of building best meets demand, as venture capital firms are showing a preference for small, fast-growing companies over mid-sized ones that require larger spaces.
Despite the challenges, there is optimism for the future as VC money invested in UK life sciences companies is increasing. However, developers and real estate companies need to consider the long-term sustainability of their partnerships with academic and government institutions to fully capitalize on the UK’s potential in the life sciences sector.
