19 April 2022/ Guides

What role will the UK play in the future of life sciences?

In the wake of the coronavirus pandemic, life sciences is a sector at the centre of the UK’s levelling up ambitions. In terms of scale and market maturity, there’s no doubt that it is playing catch up with the likes of the U.S. But with the government’s focus on positioning the UK as a life sciences ‘powerhouse’, there’s now a surging appetite for life sciences workspace. Currently, the ‘Golden Triangle’ of London, Oxford and Cambridge is propping up those ambitions, leaving much to ponder on whether the UK has the capacity to compete on the life sciences global stage.

Until recently, the UK’s life sciences sector was seen to be lagging behind. Its challenges were threefold: a lack of data, a lack of expertise and a lack of suitable investment opportunities. Now though, with life sciences regularly on the agenda for government and investors, there are opportunities for the UK to take steps towards establishing itself as a global leader.

The glistening Golden Triangle

Linking the UK’s capital with its two leading universities is the Golden Triangle, considered by many as the world’s leading concentrations of biotechnology and life sciences. The rapid growth of the life sciences sector between London, Oxford and Cambridge has placed a growing responsibility on the property sector to facilitate its expansion; to nurture its development, along with the investment necessary for its ongoing success.

Having been a largely alternative sector for years, the market for life sciences has been insatiable of late, proving it has moved from the peripheries to the mainstream. Just this month, Kadans Science Partner and Canary Wharf Group formed a joint venture to develop a new 750,000 sq ft, GIA life-sciences-focused, wet lab-enabled building at Canary Wharf in London – the largest in Europe. Set to be delivered in 2026, it will be a laboratory building at its core, with full flexibility allowing lab space on all floors.

Canary Wharf’s ambition to get into the life sciences sector has been ongoing for several years; the Group is looking to diversify beyond its traditional core markets of finance, and its collaboration with Kadans is a real endorsement of the expected growth of life sciences in the coming years.

The innovative approach of Kadans and Canary Wharf to combatting the limited spatial resources of the life sciences sector in the Golden Triangle will doubtless become commonplace in the years to come. While fundamentally the UK’s innovative hub, it remains chronically undersupplied for lab-enabled or fitted lab spaces. This leaves occupiers with a problem: are they willing to compromise on the space, if they can get it quickly?

Repurposed sites: short-term good, long-term bad?

With the life sciences sector looking set for exponential growth over the next decade, investors and businesses are wanting to get in as soon as possible. But space in the Golden Triangle is limited, with Cambridge currently having zero laboratory availability, despite a requirement of nearly one million sq ft.

This constrained supply is leading investors to seek alternative options. The Kadans site is an example of life sciences infrastructure that would have been unthinkable until recently. With key requirements for these sites including access to fresh air, easy loading arrangements and floor-to-ceiling height, multi-storey buildings would’ve been rejected as sites for life sciences labs. Not anymore.

Sites that formerly housed supermarkets or offices are also being converted into life sciences spaces to meet demand, and in these situations, compromises are being made. But while investors may be happy to make these compromises in the short term if it means setting up shop faster, then they may be underestimating the longer-term implications. It’s expected that over the next decade, the supply of specialist, purpose-built sites will increase. And when this happens, these converted assets will be far less competitive in the wider market.

A broader approach

Perspective is important. The life sciences sector in the States currently dwarfs that of the UK, with Boston’s infrastructure alone fitting on top of the Golden Triangle geographically. Further comparison shows that while there were more than 13,000 life sciences research papers published in the US last year, there were just 3,600 in the UK. The large talent pool, sophisticated equity market and high GDP spend on research and development in the US means that it has spread out its life sciences ecosystems to cities like Chicago, Dallas, Miami and Sacramento – cities that aren’t inherently life sciences-orientated.

In meeting the government’s ‘levelling up’ push for life sciences, a broader approach in the UK – with investment into expanding the offering within the Golden Triangle, but also that of the rest of the country – is needed. Too heavy a focus on areas with the highest cost of living could well be detrimental to the global ambitions of the UK’s life sciences sector, as attracting the right people will be as important as attracting the right investors.