Asia-Pacific life sciences sector will provide advantage for owners: JLL Research

The rapid expansion of the life sciences sector will provide substantial opportunities for commercial real estate owners and developers in Asia-Pacific, as real estate becomes a priority for companies that provide medical and healthcare products and services.

According to global real estate consultant JLL, life science-focused businesses in Asia-Pacific are poised to grow significantly by 2025, with access to highly specialized spaces – including research and development labs (R&D) and medical practices – seen as a catalyst for unlocking the growth potential of the sector.

JLL surveyed real estate and facilities management professionals at life sciences companies in Asia Pacific and found that more than three-quarters (76%) believed the sector’s operational performance would improve over time. over the next three years. Respondents pointed out that new sources of revenue, including the development and deployment of Covid-19 vaccines, the production and supply of personal protective equipment (PPE), ventilators, therapeutic treatment and testing, have transformed the area. The demand for research and innovation to solve existing public health problems continues, providing a longer-term growth engine for the life sciences sector and fueling its real estate demands.

“The future success of the life sciences sector in Asia-Pacific is tied to the depth of commercial real estate supply in the market. As competition for high-quality, specialty space intensifies, owners and investors in life science real estate have an opportunity to play a role in incubating the next phase of industry growth.” , said Tim Graham, Head of Capital Strategies, Asia-Pacific, JLL.

However, only one in three respondents say it is easy to find a property that meets their requirements in terms of space, location and quality of fit-out. JLL found that to ensure high-quality space, life sciences companies are more willing to commit to longer leases than short-term flexibility, with a third of respondents now seeking longer leases by compared to five years ago.

Specifically, occupier demand is likely to be highest for R&D facilities and medical practices as the sector matures in the region. Two-thirds of respondents believe they will need more R&D space by 2025 to achieve their business goals; 60% of respondents will need more medical practices while 56% need space for manufacturing sites.

“Life sciences occupiers will increasingly need innovative spaces to achieve their business goals. However, the biggest challenge they will face is the lack of specialist real estate that can facilitate the growth potential of the sector. Our conversations with clients lead us to believe that the solution will require more partnership between occupiers, landlords and life science developers to adapt real estate to changing industry demands,” says Richard Cheeseman, Head of Life Sciences, Asia-Pacific, JLL.

Partnership between occupiers and owners will become more critical by 2025, according to life science real estate professionals. More than three-quarters (76%) of respondents want to work more closely with owners and developers on or tailor-made facilities for R&D. spaces with 66% open to increased partnership when designing office space.

Methodology

JLL surveyed 150 corporate real estate and facilities management professionals working in life sciences organizations in the Asia-Pacific region. Respondents represent multinational and national life sciences industries operating in Asia-Pacific, including healthcare, biopharmaceuticals, pharmaceuticals and medical devices.

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