Site Selection magazine
twitter linkedIn facebook email email email
From Site Selection magazine, September 2017

The Rich Get Richer

According to JLL’s newest Life Sciences Outlook, the favorites are still winning the race despite rising costs.


The average annual salary for R&D professionals has reached $135,000 in the past five years, while the average salary in the sector overall has increased 19.2 percent. But even as real estate and personnel costs keep rising, so do the fortunes of the top life sciences clusters.

For those who still have a hard time finding an affordable place to live despite their rising pay, the workplace is growing more attractive as a place to spend even more time: Companies are creating campuses as focused on how good employees feel as on creating products to make the rest of us feel better.

Those are among the conclusions you can draw from JLL’s annual Life Sciences Outlook report, released this summer. 

“In the face of a changing workforce, companies are prioritizing locations and spaces that can improve the well-being of their employees,” says Roger Humphrey, executive managing director and leader of JLL’s Life Sciences group. “With millennial interests demanding attention in a growing war for talent, companies are increasingly seeking out more amenity-rich spaces. In response, developers are redefining life sciences real estate as projects such as the Cove at Oyster Point in San Francisco aim to create a vibrant, collaborative environment that provides a communal atmosphere beyond your standard 9-to-5 campus.”

Greater Boston and the San Francisco Bay Area continue their reign as the top US life sciences clusters. They share common characteristics such as world-class academic institutions, top-notch research facilities and a tight-knit medical community.

But status as a leading cluster doesn’t always mean you’re far enough out in front of demand.

“Even highly competitive clusters such as Seattle-Bellevue have a dearth of ongoing development,” says Humphrey. “Alexandria Real Estate Equities is currently building a 289,000-square-foot project in the cluster’s Lake Union submarket, but it will come online already fully leased to Juno Therapeutics later this year. The city’s mayor has praised the project and stated that it underscores Seattle’s standing as a global hub for biotech.”

That same REIT is behind The Alexandria at Torrey Pines in San Diego (the No. 3 cluster), as well as the newly launched Alexandria Center for AgTech — RTP, a planned multi-tenant “mega campus” in No. 4-ranked Raleigh-Durham.

Acquisition and Attraction

When it comes to biotech in particular, Humphrey observes that Big Bio, fueled by growing cash reserves and pressure to keep growing, is now following the lead of Big Pharma and seeking innovation through acquisition and strategic partnerships rather than cultivating it in-house. EY data shows the biotech sector as a whole increased R&D spending by 28 percent in 2016, a far larger increase than Big Pharma.

Humphrey also shares these observations about specific biotech clusters:

San Diego: “Global biotech and pharma companies continue to depend on early-stage biotechs to drive innovation, and San Diego has proved it can do just that. The region has secured over $56 billion in M&A activity since 2011.”

Chicago: “Lake County continues to drive Chicago’s life sciences cluster with more than 100 biotechnology/pharmaceutical companies, including 10 corporate headquarters.”

Montréal: “Laval’s Biotech City is the second largest cluster for occupied lab and manufacturing space in Greater Montréal, and has the most dense grouping of life sciences companies in the region. Laval is located in a different administrative region than Montréal, meaning companies here benefit from a different structure of tax incentives and credits for the operation of their activities.”

New York City: “New York City is emerging as a leading destination for biotech startups and the larger life sciences industry.”

Adam Bruns
Managing Editor of Site Selection magazine

Adam Bruns

Adam Bruns has served as managing editor of Site Selection magazine since February 2002. In the course of reporting hundreds of stories for Site Selection, Adam has visited companies and communities around the globe. A St. Louis native who grew up in the Kansas City suburbs, Adam is a 1986 alumnus of Knox College, and resided in Chicago; Midcoast Maine; Savannah, Georgia; and Lexington, Kentucky, before settling in the Greater Atlanta community of Peachtree Corners, where he lives with his wife and daughter.


Related Articles

Subscribe to Site Selection

Most Popular Articles

Site Selection online is a worldwide service of Conway Data, Inc. ©1983-2024, all rights reserved. Data is from many sources and not warranted to be accurate or current. To unsubscribe from our print magazine, contact Julie Clarke. For general inquiries, visit our contact page. For technical inquiries contact the Webmaster.