The newly created Department for Science, Innovation and Technology is tasked with encouraging stronger growth, better jobs and bold new discoveries according to its Secretary of State, Michelle Donelan.
This aim is commendable and the increased focus will hopefully prioritise and accelerate the UK life sciences sector. However, the government needs to work more closely with businesses to help the UK achieve its full potential, including the real estate industry, which has a crucial role to play in delivering the highly specialised space required by life science firms to operate effectively.
While it enjoys a leadership position in Europe, compared with the US, the UK remains a sleeping giant. The UK life sciences sector possesses the same key growth characteristics as the US and a strong track record in research and innovation, which could make it a global leader if it did more to translate this into commercialisation. This is something the US has been very successful at and is why a lot of output from UK research institutes goes across the Atlantic.
The UK’s ‘golden triangle’ between London, Cambridge and Oxford is the most established life science market in Europe, with an abundance of high-quality firms attracted to its unrivalled access to talent from world-renowned universities, first-class, yet full, research and development facilities, and excellent transport connectivity.
“These projects create wider societal benefits and can deliver a sustainable use for older office stock by converting them into life science facilities.”
However, in recent week, pharmaceutical giants and key UK life sciences occupiers GSK and AstraZeneca have criticised the government and its policies for directly hindering their businesses. AstraZeneca’s decision to build a £320m factory in Dublin rather than in the UK demonstrates this dissatisfaction and should act as a wake-up call for central government about its approach.
Calls have been made for the government to offer tax breaks to encourage development; to offer more research funding; and, most pertinently in our industry, for the planning system to be updated to make it easier to deliver suitable space. Our experience with planning authorities in the US, for example, has been far easier, where the density required for life sciences development, or ability to convert other uses into life sciences, is actively encouraged and is often pre-zoned by local government.
In France, where science and technology are also a focus of President Macron, local mayors are realising that they can offer grants that encourage businesses to establish themselves in their local areas, which brings direct and indirect employment to their towns and boosts economic growth. The UK needs to do the same or it risks missing out to the rest of Europe.
While greater progress is still required, more UK councils are recognising the benefits that life science brings. The impact goes beyond economics; these projects create wider societal benefits and can deliver a sustainable use for older office stock by converting them into life science facilities.
Great examples of local bodies looking to maximise the economic and social impact of life sciences can be found in London’s ‘Knowledge Quarter’, stretching from Camden to Holborn. This area could become one of the pre-eminent innovation clusters in the world and here, Oxford Properties has been collaborating with local stakeholders to deliver much needed life sciences space in the heart of London.
Our hope is that with the prime minister spearheading this new focus, government will become more supportive. We are calling for further investment in the Oxford-Cambridge Arc in the heart of the golden triangle to help it grow and potentially rival the Boston biopharma cluster in the US.
This is central to the UK’s present and future economy and it is crucial that supporting its growth is a government priority. As the life sciences sector develops across Europe and venture capital volumes accelerate, the UK needs to ensure there is both government support available and a sufficient pipeline of suitable space to both retain and attract the best companies.
The UK government has taken some initial steps in this direction by creating strategic partnerships with investment company Mubadala and providing funding to start-ups – but we need to see it do more.
Oxford, like many of our fellow institutional investors, has the capital and desire to invest in the UK life sciences sector. Oxford can also call upon the best practices from R&D labs and good manufacturing practice facilities we have built across the globe to ensure the UK enjoys some of the world’s best life science real estate infrastructure. But it will require collaboration from all levels of government to ensure the UK realises its full potential.
Joanne McNamara is the executive vice-president for Europe and Asia-Pacific at Oxford Properties
Blink and you’d have missed them, but a year on from Liz Truss and Kwasi Kwarteng’s widely derided clanger of a ‘mini Budget’, housebuilders and estate agents are still reporting the aftermath. Imagine if the former prime minister and chancellor had unleashed a ‘maxi Budget’?
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