JLL: Life Sciences Continues Its 'New Age of Innovation'

The long-term potential of the life sciences sector remains materially unchanged since 2021 – and it’s in a new age of innovation, according to Travis McCready, head of life sciences, JLL’s Americas Markets.

In its 2022 Life Sciences Research Outlook & Cluster Rankings, JLL said it believes that short-term challenges are just a temporary blip on the long-term path of growth because the world relishes novel therapies, innovative new modalities, increased adoption of advanced technologies and has an “insatiable demand for health and wellness that will drive the investment and growth forward for the foreseeable future.”

JLL lists Boston, San Francisco and San Diego as its three most promising life sciences markets, respectively.

“Innovation is happening at a more rapid pace than ever before, the fruits of research into cell and gene therapy are just now being harvested, and revenue growth has taken off in the past five years as the sector becomes larger, an atypical growth track,” McCready said.

“Additionally, three of the largest annual revenue increases in biotech R&D over the past 20 years have occurred in the last five years, as the sector accelerated.”

Boston’s Life Science Market ‘Not Easily Replicated’

Amber Schiada, JLL head of life sciences Research, tells GlobeSt.com, “Innovation communities take decades to evolve. The world-class ecosystem that defines Boston’s life sciences cluster, for example, is not easily replicated.

“Universities, institutions, governments and industry players across the U.S. are investing in the development of new and expanded innovation clusters with increased focus on expanding our capacity for breakthrough scientific developments.”

One Size Fits Most

On the new life sciences cluster composition matrix, Roger Humphrey, president, life sciences work dynamics, JLL, tells GlobeSt.com, “Talent, funding and commercial restate infrastructure are quantifiable market indicators, but our view on what defines opportunity is not meant to be one-size fits all, but rather one-size fits most.

“This is a new and groundbreaking way of looking at how our innovation communities can inform location choices for growing companies or for startups where to scale, for example.”

Current Industry Fundamentals Slowing

Commercial real estate’s current industry fundamentals are slowing, but this is a short-term challenge, and the flow of capital remains well above historical trend, according to the research report.

Tenants are taking pause or re-leasing excess space to the market, according to the report, but demand remains above historical levels, and space is still scarce, JLL said, citing vacancy at sub-6% across the top clusters in aggregate.

It helps clusters to attract the right talent, healthy levels of funding and investment, and the real estate infrastructure to support expansion, JLL said. But early movers will remain the most resilient during the short term, finding potential early-mover advantages.