Savills forecasts 474,000 sqm of new office and lab requirements in Europe

According to Savills latest research using Pitchbook data, €13.2 billion of venture capital (VC) was raised by European headquartered life science companies between 2014 and 2018, resulting in over 650,000 sqm of office and lab deals across selected European life science markets between 2016 and 2020. Biotechnology and nanotechnology industries are also developing rapidly in Poland.

Savills calculates that every €1 billion of VC investment creates 46,000 sqm of life science real estate demand. Rolling this forward, the €10.2 billion of capital invested during 2019 and 2020 indicates that approximately 474,000 sqm of new requirements from the life sciences sector will emerge between now and 2022.

A new office space supply of 5.2 million sqm, which is distributed across 24 markets in Europe, is due to be completed this year, with a similar amount of supply (5.1 million sqm) due in 2022. 

However, Savills predicts that with half of this space already committed – 54 percent of new offices in 2021 already pre-let and 39 percent in 2022 – the life science industry will be competing with other occupiers for the best space in the right places, making it crucial for the sector to plan and secure space as soon as possible.

Pharmaceutical companies operating in Poland, usually own the production facilities or laboratories in which they operate. The exceptions are mainly represented by the company’s main offices, back offices, or financial services centers, which are located in the different office buildings. According to Savills data, during the last five years, the annual take-up of pharmaceutical/life science companies in Poland was at the average level of 76,300 sqm per annum, with the largest volume recorded in 2016 (91,600 sqm).

“Poland is now home to the sixth-largest pharmaceutical industry in Europe. The Covid-19 pandemic has further accelerated the growth of this sector. Biotechnology and nanotechnology are currently the most rapidly developing industries that continue to support occupier demand across Poland,” Wioleta Wojtczak, Head of Research, Savills Poland, said.

(WBJ)