September 28, 2016 Comments Off on California’s Life Sciences Sector Remains Healthy Views: 349 Bay Area, California, California News, Los Angeles, Orange County, San Diego, West

California’s Life Sciences Sector Remains Healthy

Life sciences plays an important role in a number of California markets, including San Francisco, San Diego, Orange County and Los Angeles. JLL’s latest report on trends impacting the sector revealed how the clusters stack up.

The report found that the overall cost of operating is increasing. Life sciences vacancy rates remain unfathomably low in top clusters, and asking rents continue to rise.

San Francisco highlights via JLL’s Christan Basconcillo

  • San Francisco life science cluster is No. 2 behind Boston in JLL’s 2016 rankings
  • The overwhelming majority of life sciences capital went to establishments in Greater Boston and the San Francisco Bay Area in the past year
  • South San Francisco’s The Cove is the largest life sciences development currently underway in the U.S. The two-phased, seven-building campus will total one million square feet upon completion
  • The Bay Area received more than $1.5 billion in VC funding, roughly 22% of the U.S.’s total
  • The region accounts for a majority of U.S. patent filings

 San Diego highlights via JLL’s Grant Schoneman

  • Growth caused rental rates to record double-digit increases, and left companies with limited space options
  • Market activity in 2016 plateaus from prior years
  • Current active tenant demand is robust at more than 1.5 million square feet
  • Demand for life sciences facilities includes more than 1.4 million square feet added in the past 12 months, and 1.1 million square feet under construction
  • 65% of total VC invested in San Diego went to biotech companies
  • Continued trend of re-positioning buildings to provide biotech companies with newly modernized space solutions, often within a larger campus that is accompanied by numerous amenities

 Orange County highlights via JLL’s David Cantwell

  • There’s an abundance of successful companies and new venture startups
  • More than 1,100 life sciences companies call OC home, and the industry employs more than 115,000 people
  • Received $427 million of VC funding, roughly 6.22% of the total in the U.S.
  • Challenges include funding and the acquisition of space that provides the appropriate infrastructure and flexibility for future growth

Los Angeles highlights via JLL’s Shaun Stiles

  • Los Angeles / Orange County life sciences cluster produces 31% of all U.S. patents, yet the metro accounts for only 16.2% of the VC funding and 9% of NIH funding
  • 68.1% of Southern California’s NIH funding went directly to the top three medical research universities: UCLA, USC and UCI
  • Sector is responsible for more than $27.3 billion in annual economic activity and employs 117,000 people
  • Market vacancy for life sciences space is at 2.9%, the lowest since the last market peak when vacancy reached 2% in 2006

Read More at JLL

Connect with JLL’s Basconcillo

Connect with JLL’s Schoneman

Connect with JLL’s Cantwell

Connect with JLL’s Stiles

For comments, questions or concerns, please contact Dennis Kaiser

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