A CBRE report examines how the life sciences industry has thrived during the pandemic. CBRE has found that investors have a greater interest in the life sciences industry as it looks for a vaccine and treatments for COVID-19. And that has created an increased demand for commercial real estate.
From CBRE’s “Leading Life Science Clusters The Bio-Boom Intensifies:”
“The industry has displayed remarkable resilience to the economic downturn, with new sources of demand and a flood of venture capital to support various initiatives. Across the various U.S. life sciences lab clusters, our data shows a market undeterred by disruption and, if anything, recharged for an intensified expansion.”
Here are some of the report’s findings:
- Boston-Cambridge, the San Francisco Bay Area and San Diego remain the nation’s top three life sciences clusters, while Pittsburgh, Houston and Austin are top new emerging ones.
- While life science employment was down by just 1.3% in July from its peak in March, it was 1% higher than a year ago compared with the 7.6% decline in total nonfarm employment. Biotech R&D employment has been particularly strong, up by 4.9% from a year ago and outpacing tech employment growth.
- Total venture capital funding for the life sciences industry for the year ending Q2 2020 was a record $17.8 billion.
- National Institutes of Health funding to major universities and institutions for health-care research is forecast to grow by 6% this year to $42 billion.
- Total commercial laboratory space has grown by 12% this year to 95 million sq. ft. Another 11 million sq. ft. is currently under construction.
- Reflecting a broad pullback in commercial real estate investment, lab/R&D property sales totaling $9.6 billion for the year ending Q2 2020 fell by 18% from the same period a year ago. However, pricing remains intensely competitive.
- A continued positive outlook is underscored by new growth drivers, such as government emphasis on the life science industry’s pivotal role in combating the COVID-19 pandemic, onshoring trends and rapid expansion of biomanufacturing.
Download the full CBRE report here.