Investment volumes for life science real estate across the Knowledge Arc of Oxford and Cambridge hit a record high of £1.65bn last year, according to data from Savills. The volume of investment was up around £50m on the previous year.
The bulk of the activity took place in Oxford and Cambridge, with other notable deals occurring in Potters Bar and Stevenage, accounting for an additional £200m.
Savills said there was a diverse range of buyers from UK institutions and overseas core purchasers to private equity investors, and a number of acquisitions completed last year incorporated significant future development opportunities, which would help to meet the undersupply of ‘stabilised assets’ within the life science sector.
Tom Mellows, head of UK science at Savills, said: “Occupiers in the life science sector are desperately in need of good quality accommodation within the Oxford Cambridge Arc. The severe supply shortage is being addressed by significant investment into future development sites, and we expect to see a number of our clients speculatively develop high-quality laboratory schemes within the next 12-24 months.”
According to Savills, 2023 has already got off to an encouraging start with circa £220m of assets under offer in Oxford and Cambridge.
James Emans, director in the investment team at Savills, added: “Despite the headwinds in the second half of 2022, the buyer pool for the science sector remains extraordinarily healthy. Of the stock that was traded last year, there were over 20 different purchasers and we would anticipate there to be nearly three times this number who would consider themselves active across the Oxford and Cambridge investment market going into 2023. This is testament to the sector’s ongoing resilience.”
