COMMENT Behind the successes of the world’s most renowned hubs of innovation, such as those in San Francisco and San Diego, is the presence of the triple helix between government (as funder and customer), academia (as custodian of scientific discovery) and industry (which invests, commercialises and acquires).
The existence of this three-way partnership has allowed the UK to create world-leading ecosystems of its own, including those found not just in the “Golden Triangle” of Oxford, Cambridge and London, but also in key regional cities such as Nottingham and Cardiff.
Meaningful links between academics, researchers, governments and pharmaceutical firms are critical to an ecosystem’s success. The role of the real estate industry is to create the spaces that support their interaction.
Innovation exporter
By providing the workspace, amenities and broader offering that will help early-stage ecosystems attract talent and inward investment, property investors can play an active role in helping the UK life sciences sector remain a key economic contributor. In turn, this will also ensure that Britain remains a global exporter of innovation.
Our £120m acquisition of BioCity Group, a successful accelerator for nearly 20 years, is setting out to do just that. Branded We are Pioneer Group, the new integrated business will combine early-stage life science investing and an accelerator programme, alongside a real estate investment platform backed by leading investment manager Harrison Street, which manages 2.6m sq ft of labs.
By integrating venture development, investment, real estate and sector-specific networks, We are Pioneer Group will create the UK’s largest life sciences ecosystem, helping to connect companies with potential partners and promoting tech transfer between universities, research institutions and the private sector. Operating in nine locations across England, Scotland and Wales, the new firm will host 600 high-growth businesses – equivalent to 7.5% of the UK’s total life sciences ecosystem.
The aim is to replicate the successes that have underpinned 40 years of world-leading commercialisation in North America – a location where, unlike in Europe, it is commonplace for real estate investors to manage labs and national networks of accelerators directly.
Expanding sector
Although interest in UK life sciences has grown substantially over the past year – driven in part by the Covid-19 pandemic and a £2.3bn funding commitment by the UK government as part of an expansion of research and development budgets – the sector is still a long way off of its cousin across the pond.
The success of innovation ecosystems depends on the support given to early-stage companies – in terms of the availability of both funding and purpose-built space. This has implications across the whole supply chain, as big pharma has become increasingly reliant on small firms to drive new drug discoveries. M&A activity reached an all-time high of $357bn globally in 2019, according to EY.
There is vast capacity in the market, not just for more high-quality incubator space but for a broader range of specialist life sciences real estate that can support Britain’s growth. The UK is now the third-largest life sciences market globally, after UK-based biotech companies raised £1bn in direct VC funding in 2020.
Although early-stage science remains a highly specialist field, with the proper investment in real estate we can help ensure that core life science hubs offer tomorrow’s innovators the very best chance of pioneering some remarkable discoveries.
Richard O’Boyle is executive director of Trinity Investment Management and We are Pioneer Group
