The outbreak of the novel coronavirus in 2020 has accelerated growth and funding for new drugs and technologies. In fact, private equity firms invested nearly $70 billion in life sciences and medical devices last year. American Investment Council CEO Drew Maloney said in an interview, “What COVID brought was probably a bigger focus on healthcare gaps and needs… and I think you saw more money going into this sector as a result of a new focus on exposing some of the challenges we have in the healthcare system.”
This increased investment has, in turn, brought increased demand for life sciences space, especially in markets that are mature, like Boston, San Francisco, and New York City, where an existing skilled labor pool already exists. At the same time, new markets are quickly gaining traction and attracting new investments as some firms are finding the established markets too pricey in terms of labor costs or lacking their required space. Each of these variables must be considered.
There’s also the question of whether an existing or purpose-built facility is the right choice. Leasing space in traditional office buildings can provide a solution for life sciences companies with dry lab needs, as well as those involved in cell and gene therapies and R&D. However, existing space may not work for wet labs where scientists work with biological materials that rely on specialized systems for air filtration, plumbing, waste disposal, life safety, and fire protection. Finally, any facility decision must take into account not just what is needed today but also how the facility’s layout can be adapted to future needs as the life sciences company’s needs evolve.