Science occupier activity slows across the Golden Triangle

Take-up of science-related real estate across the Golden Triangle markets has slowed in the first half of this year, according to Savills. Leasing activity reached 566,000 sq ft in the six months to 30 June across London, Cambridge and Oxford – a 19% fall on the 697,000 sq ft recorded over the same period last year, Savills’ research found.  The findings comes amid a reduction in venture capital investment over the past 12 months as a result of ongoing global economic uncertainty. Inflows The first half of this year saw around £900m of VC investment raised by companies headquartered in the Golden Triangle, marking 64% of the total level raised in 2023. In addition, in the year to date, more than 75% of the venture capital investment raised, by value, is later-stage. Two recent examples include Myricx Bio raising £90m in series A funding round and Beacon Therapeutics raising £130m in series B funding round. Occupier market Turning back to leasing, this year, just 25% of all deals in the region were for laboratory space, whereas in H1 2023, more than half of the total transacted space was for labs. This is due to a lack of large transactions so far this year. When looking at the number of lab lettings of less than 10,000 sq ft in H1 2024, the figures are broadly in line with those of last year for the same period. Key deals across the region so far this year saw Ellison Institute lease 27,791 sq ft of fitted lab and office space at Winchester House and Oxford Nanopore take 13,000 sq ft of fully fitted lab space at the Sherard Building, both on Oxford Science Park. Meanwhile, in Cambridge, Welbeck Health Partners acquired 32,000 sq ft of shell and core lab space at The Orion Building at Unity Campus in Cambridge.  H2 expectations Looking ahead, Savills has tracked a number of sizeable requirements for science-related space across the region, with requirements in Oxford alone totalling 1.1m sq ft, a further 500,000 sq ft of active or upcoming demand in London, and up to 225,000 sq ft in Cambridge. Tom Mellows, head of UK science at Savills, said: “We have seen the current economic headwinds, in particular high interest rates and restricted venture capital, subdue occupational activity this quarter across the Golden Triangle. “However, we are seeing more positivity for the remainder of 2024 and into 2025, with active demand and viewing levels picking up in all markets, from small and medium-sized enterprises to larger corporates, as well as the reactivation of some larger requirements that were paused 12-24 months ago. All being well, this should translate into greater take-up levels in the second half of the year.”