According to Savills latest Life Sciences: Trends & Outlook Report, Oxford and its surrounding areas saw £1.5 billion of life science related capital raised by companies headquartered in the UK in 2020, a 47% increase on 2019 figures.
Over the past five years capital raised, including mergers & acquisitions, private equity and venture capital (VC) has amounted to £3.7 billion, 40% of which was secured in 2020. Savills attributes this significant increase to the city’s instrumental role in the fight against Covid-19, which saw the Oxford-AstraZeneca vaccine approved in December last year. Consequently, funding for biotechnology and drug discovery firms headquartered in and around Oxford jumped by a considerable 242% and 137%, respectively.
Alongside the fast-track of the Vaccines Manufacturing and Innovation Centre (VMIC) at the Harwell campus, other key deals saw Eurofins Bioanalytical take 16,823 sq ft (1,562 sq m) at 90 Park Drive, Milton Park and a lease assignment agreed to Exscientia for 12,700 sq ft (1,179 sq m) at the Schrodinger Building on Oxford Science Park. Overall, life science related occupiers accounted for 50% of all office take-up during 2020, many forging ahead with expansion plans.
Savills is already anticipating a strong year for the region, with recorded capital raising in 2021 now at circa 59% of the total level recorded for the whole of 2020 in January and February alone. Looking ahead, Oxford has around 820,000 sq ft (76,180 sq m) of office and lab capable space in the development pipeline due to be delivered over the next three years. This includes 30,000 sq ft (2,787 sq m) at Oxford Innovation Park, which is currently in for planning. This will deliver much needed grow-on space near to Oxford Science Park. In addition, Oxford University Development partnership and L&G have recently received planning permission for a 270,000 sq ft (25,083 sq m) research facility in the city centre due for completion in 2024.
Charlie Rowton-Lee, director in the business space team at Savills Oxford, comments: “2020 saw Oxford receive global recognition for its key role in finding a Covid-19 vaccine, which is already having an impact on the amount of capital being deployed into the local life science sector for the year ahead. There is no doubt that this will translate into further real estate demand as firm’s continue to both spin out of the university and require the right grow on space. Despite its size Oxford remains in the top 25 cities globally (excluding the US) that continue to dominate when it comes to VC funding and I can only see it climbing up the ranks as interest in life sciences increases.”