COMMENT Oxford and Cambridge have been the driving force behind putting the UK on the global life sciences map. However, London’s comparative immaturity in terms of specialist real estate, alongside the sheer scale of its talent pool, academic prowess, health data, and global financial standing presents an unparalleled opportunity for growth.
London has a number of dynamic emerging clusters based around leading academic institutions and major teaching hospitals. Their affiliated research entities and charitable endowments are often important catalysts and advocates for such growth. Whitechapel, London Bridge, Waterloo, King’s Cross and White City all host ecosystems that facilitate the overlap between research and practical application, offering access to key equipment and clinical trials, driving commercialisation and consolidation. The ability for universities to promote entrepreneurship alongside medical research is often key to supporting its translation into marketable product lines.
This process leads to further consolidation as occupiers that are unaffiliated to the host institution are drawn by the opportunity to cluster around specialist academics or firms in similar areas of science. This collaborative environment fosters innovation and helps attract talent, and in doing so, creates a buzz around a specific location.
At present in London there is 350,000 sq ft of existing occupied commercial laboratory space, with a further 950,000 sq ft with planning consent and/or actively under construction. This will help serve the 800,000 sq ft of live requirements currently in the market. This is a figure that is increasing as the volume of venture capital investment into the London market grows, with just over £1bn raised as of September this year. Demand will be bolstered further still as host institutions develop and promote their commercialisation strategies. An example of this is KHP Ventures, a collaboration between King’s College London, King’s College Hospital NHS Foundation Trust and Guy’s and St Thomas’ Hospital NHS Foundation Trust.
Agility is key
Consequently, we are starting to see the delivery of purpose-built and speculatively developed lab space in the capital from investor developers, often from the US but also from Europe, Asia and new entities within the UK. They bring established networks within the venture capital research and development community, which gives them transparency and access to occupiers. Similarly, they are in a position to attract companies which rely on their established know-how when it comes to the specification, delivery and management of specialist space.
The key to providing the right real estate is agility. The speed at which life science occupiers grow means that their space requirements change rapidly. One example of this is Autolus Therapeutics, a company specialising in developing T-cell therapies to treat cancer. The company was a UCL spin-out in 2014 and has grown to more than 300 staff.
With this in mind, it is essential for clusters to provide graduation of space to cater for all stages of a company’s evolution. This can include everything from fully-fitted and operated small-scale space for start-ups at seed-funding stage, to large floorplate and quantum space for established businesses, as well as including provision for manufacturing and any other necessary servicing. One of the biggest challenges for anchor institutions is avoiding the flight of intellectual property and talent because of a lack of available space. The ability to unlock sufficient land in constrained central London locations is an ever-present issue.
It may well be that the boundaries of London’s emerging clusters become blurred in the future as the sector evolves and land supply remains tight. In the meantime, the real estate industry has a key role to play in facilitating the provision of space to support the growth of key hubs. Close collaboration with anchor institutions is vital to this, enabling them to fulfil their part of the equation by filling the space with cutting edge and commercialised R&D. Ultimately, this has the potential to deliver win-win benefits: commercial success and major public health benefits for London and, as a result of this, the rest of the world.
Tom Mellows is head of UK science and Oliver Fursdon is head of London commercial development at Savills
