UK Life Science Marketbeat Reports

For the data behind the commentary, download the full Q3 2024 UK Life Sciences Report.

Golden Triangle Leasing Activity Rebounds in Q3 2024 with Significant Growth Expected

In Q3 2024, the Golden Triangle saw a significant rebound in leasing activity, totaling 84,400 sq ft, a 95% increase from Q2 but still 47% below the five-year average. Cambridge led with 48,900 sq ft leased, followed by Oxford with 28,100 sq ft, and London with 7,400 sq ft. Major deals included Nucleome's 20,000 sq ft lease in Oxford and Biocrucible's 19,200 sq ft in Cambridge. With 262,700 sq ft under offer, continued growth is expected into Q4 and early 2025. Prime rents remained stable, with Cambridge at £77.00 psf, Oxford at £62.50, and London at £130.00 psf.

Promising Signs of Recovery in Golden Triangle Life Sciences Investment Market

In 2024, the Golden Triangle life sciences real estate market saw subdued investment volumes, with £289 million transacted from Q1 to Q3, below recent averages. However, Q3 showed promise with over £260 million in deals under offer, some of which have since completed. Key transactions included properties in London and Cambridge. Prime yields remained at 5.00%, and with the Bank of England cutting interest rates for the first time in four years, further rate cuts are expected to boost investor sentiment and transactional volumes in the coming quarters.

Golden Triangle Sees Significant Lab Space Development Amid Easing Supply Constraints

In Q3 2024, five schemes totaling 124,000 sq ft were completed in the Golden Triangle, with significant projects in Cambridge, Oxford, and West London. At the end of Q3, 4.3 million sq ft of lab space was under construction, with 12% pre-let or under offer. An additional 4.5 million sq ft is planned for completion by 2028. Despite high construction and financing costs, expected interest rate cuts may improve project viability. Supply constraints are easing, but a 1.3% vacancy rate in Cambridge indicates ongoing imbalances, while higher availability in Oxford and London supports sector growth.

Record VC Funding Boosts UK Life Sciences with Focus on Later-Stage Investments

In Q3 2024, UK life sciences companies received £820.4 million in Venture Capital funding, 17% above the five-year average and a 65% increase from Q2. London led with 63% of the total, while Cambridge accounted for 22%. Later-Stage investments dominated, making up 89% of the total, with Early-Stage and Seed funding significantly lower. The average deal size hit a record high of £18.6 million, indicating VCs are concentrating larger investments on fewer, more data-rich companies.