Cushman & Wakefield has released its latest Life Sciences Lab Report on the UK's Golden Triangle. The Golden Triangle report looks closely at investment volumes, leasing take up, lab supply and pipeline, and investment into life sciences real estate across Cambridge, Oxford and London.
Headlines:
Q4 2023 Take-Up Statistics
- Golden Triangle leasing activity totalled 169,000 sq ft in Q1 2024.
- Whilst a step down from the 364,000 leased in Q4 2023, it remained 5% above the five-year quarterly average.
Evolving Demand and Supply
- There is 2.8 million sq ft of life sciences space under construction across the Golden Triangle.
- 24% of supply under construction is pre-let or under offer.
- A slowdown in venture capital markets alongside a string of recent completions brought a modest easing in the demand-supply imbalance
- Prime headline quoting rents in Q1 2024 increased by 8% in Cambridge to £70.00 psf while Oxford and London held firm at £62.50 in Oxford and £130.00 respectively.
Venture Capital
- The first quarter of the year reported £641.2 million of venture capital (VC) funding invested into UK life sciences companies, up 3% on the five-year quarterly average.
- Investors are opting to invest in fewer companies overall but with larger average size for the relevant funding stage. In Q1 2024, the average funding package was £13.9 million, 29% above the five-year average.
- The global IPO market had its best quarter since Q1 2022, which is likely to encourage VC dry powder into the market.
Investment Market Insights
- A total of £192.5 million of life sciences real estate transacted across the Golden Triangle in Q1 2024.
- While this was over double Q4 2023 and represented the highest quarterly figure since Q1 2023, the high-interest-rate environment is keeping volumes subdued.
- Looking forward to later in 2024, a pipeline of transactions in the offing has the potential, if they successfully transact, to increase the number and volume of deals to the above-average levels seen in Q1 2023.
Read more in our latest quarterly report at cushwake.com or get in touch with a member of the Cushman & Wakefield team.
Gino Caiafa - gino.caiafa@cushwake.com