Knight Frank: take-up in life sciences Golden Triangle +25%

Demand for space in the UK life sciences sector continues to increase: take-up in the so-called Golden Triangle of Oxford, London and Cambridge, has gone up by 25% in the last year, according to new research by Knight Frank.

Emma Goodford, Head of Life Sciences & Innovation, Knight Frank

“Despite a challenging macroeconomic environment, we are continuing to see international capital target exciting new ventures in medical research and technology,” said Emma Goodford, head of life sciences and innovation, Knight Frank. “This investment is driving demand for lab and office space in the UK’s Golden Triangle, where the existing education, research and development ecosystems are attracting an increasingly diverse array of high-growth businesses seeking flexible space capable of supporting their growth.”

Take-up in the Golden Triangle was 186,000 sq ft in Q1 this year, up 25% from the same period last year as the sector continues to mature and the UK’s appeal as a hub for life sciences and innovation, start-up activity and talent quality transforms the sector and underpins demand for space.

Further supporting this expansion, government initiatives to solidify the UK’s reputation as a science and innovation powerhouse have prompted significant corporate investments in both new and upgraded facilities, Knight Frank said.

Life sciences take-up in Oxford was c.142,000 sq ft in Q1, 215% above the five-year average and up more than 900% versus the previous quarter while London life sciences take-up increased 48% versus Q4 2023 to 23,500 sq ft, both positive increases despite still showing relatively modest overall take-up. Meanwhile, Cambridge take-up decreased 86% quarter-on-quarter to 20,000 sq ft.

Looking ahead, named demand across the Golden Triangle for life sciences lab space stands at 1.66 million sq ft, indicative of resilient requirements from life sciences occupiers for lab space in the UK’s leading markets. 

The UK Space Agency’s new headquarters at Harwell Science Campus in Oxfordshire

Available lab space, however, remains constrained in all markets. Across the Golden Triangle, just over 400,000 sq ft of space was available at the end of Q1, though this imbalance is due to be partially alleviated by the end of this year with 1.37 million sq ft of space set for delivery in 2024 across the three markets.

The life sciences sector witnessed a 14% increase in venture capital funding, reaching approximately £752 million in Q1. This highlights the sector’s sustained allure to investors, particularly in contrast to the 43% quarter-on-quarter decline in UK-wide VC funding.

“Private and public sources of capital are supporting the sector’s growth, as evidenced by a spate of substantial recent investments in the life sciences manufacturing sector,” said Jennifer Townsend, research partner, Knight Frank. “Nonetheless, this growth trajectory hinges on overcoming specific obstacles, such as the limited life sciences expertise among investors and the prevailing preference of UK life sciences entities to list on international stock exchanges.”

The science sector is undergoing a diversification of demand sources. 60% of VC funding deals in the first quarter of 2024 were in the fast-growing medtech sector, including digital health, while the growing role of climate tech and space sectors in the UK economy are spurring demand for innovation accommodation in some of the country’s leading science and innovation hubs. The UK Space Agency, for example, is launching its new headquarters at the Harwell Science Campus Space Cluster in Oxfordshire and expanding with offices in Scotland, Wales, and the Midlands.