Take-up of science-related real estate across the golden triangle of London, Oxford and Cambridge fell by 19% to 566,000 sq ft in H1 2024, according to the latest data from Savills.
Although take-up this year was down on the 697,000 sq ft recorded in H1 2023, Savills said the H1 2024 figure was on par with the five-year average.
The company attributed the decrease in take-up activity to the slowdown in venture capital (VC) investment over the past 12 months as a result of ongoing global economic uncertainty.
A quarter of deals across the golden triangle region were for lab space – a 36% fall on the five-year average, due to the lack of large transactions so far this year.
There are a number of sizeable requirements for science-related space across the region, with 1.1m sq ft of reported demand for space in Oxford, 225,000 sq ft of requirements in Cambridge and 500,000 sq ft of active or upcoming demand being tracked in London.
The first half of this year saw around £900m of VC money raised by companies headquartered in the golden triangle – 64% of the total level raised in 2023. The average VC deal in H1 2024 was around £13m per deal, which is more than double the 10-year average and well above the five-year average of £7m.
Tom Mellows, head of UK science at Savills, said: “We have certainly seen the current economic head winds, in particular high interest rates and restricted venture capital, subdue occupational activity this quarter across the golden triangle. However, we are seeing more positivity for the remainder of 2024 and into 2025, with active demand and viewing levels picking up in all markets, from SMEs to larger corporates, as well as the re-activation of some larger requirements that were paused 12-24 months ago. All being well, this should translate into greater take-up levels in the second half of the year.”
