Oxford buys first asset in £1.2bn European life science strategy

Oxford Properties Group has acquired Astra Zeneca’s building on the UK’s Cambridge Science Park, its first investment in the life sciences sector in Europe where the company is planning to invest £1.2 billion over the next five years.

Oxford has paid £45 million for 310 Cambridge Science Park in an off-market deal with the Local Authorities’ Property Fund. The 59,000 sq ft (c5,500 sq m) building comprises laboratory and office space. Astra Zeneca has leased the building until November 2023, but will then relocate.

Although it made its first life sciences purchase in 2017, the deal represents Oxford’s seventh life sciences acquisition since the start of 2021. These acquisitions represent a capital commitment of $1.3 billion including the investment that will be necessary to realise development opportunities included in the deals.

Oxford already has a 1 million sq ft (92,900 sq m) $1.1 billion (£0.8 billion) life sciences portfolio in North America, and a development pipeline in excess of 2 million sq ft. Recent Oxford life sciences deals include last month’s US$173 million acquisition of Foundry31 in the San Francisco Bay Area and the US$119 million acquisition of Boren Lofts in Seattle.

Oxford has global ambition to spend up to $15 billion on sector

The £1.2 billion with which it is currently targeting Europe is part of a global ambition to spend $10 to $15 billion (£7 to £11 billion) on the life sciences sector “over time”.

Acquisitions could occur through direct property acquisition, development, buying platforms and also via debt.

Cambridge Science Park is a 152-acre campus founded on the northern edge of the city of Cambridge in 1970 and which provides approximately 1.9 million sq ft of office, lab and R&D space for 130 occupiers spanning life sciences, pharmaceuticals, technology and engineering. It is currently 100% let.

“Since our first life sciences investment in 2017 this sector has been one of Oxford’s key global conviction calls,” said Oxford Properties executive vice president Europe and Asia Pacific Jo McNamara. “Advances in data analytics and AI are accelerating life-changing innovations across biotech, pharmaceuticals, nutrition and medical devices. As a result, both private and governmental funding for promising products and companies has markedly increased in recent years. As this capital is deployed, occupier requirements increase, leading to the availability of little to no space in key global hubs such as the Cambridge Science Park or Kendall Square in Boston.”