Life sciences firms leased 2.4 million sq ft in 2022: Report
1 min read . Updated: 15 Mar 2023, 04:58 PM IST
PremiumTotal cumulative office space take-up by life sciences industry stood at 8.6 mn. sq. ft during 2019-22. Life sciences companies largely preferred Bengaluru, followed by Delhi-NCR and Hyderabad for office space take-up during the same period
New Delhi: The total leasing activity in 2022 by life sciences (LS) firms stood at 2.4 million square feet (msf), with annual sector leases crossing pre-pandemic levels, according to a report by real estate company CBRE.
The LS industry was among the top six in India that led office leasing activity during 2022. Annual leasing by life sciences companies crossed pre-pandemic levels in 2021 and 2022, specifically led by healthcare sub-sector.
Leasing activity by medical devices firms peaked in 2020 due to increased demand for safety and diagnostic kits during the outbreak of the pandemic.
“LS is one of the top alternate real estate choices for investors across the globe – a trend we have recorded over the past few years. In our latest APAC Investor Intentions Survey 2022, healthcare-related properties, including LS assets, were named the most popular alternate segment overtaking Data Centres (DCs) for the first time since the survey began," said Anshuman Magazine, Chairman & CEO - India, South-East Asia, Middle East & Africa, CBRE India.
The total cumulative office space take-up by life sciences industry stood at 8.6 mn. sq. ft during 2019-22. Life sciences companies largely preferred Bengaluru, followed by Delhi-NCR and Hyderabad for office space take-up during the same period. This was led by the presence of large LS clusters, grade A office spaces, quality R&D labs, incubation centres and research institutions in these cities.
About 57% of the space take-up by LS firms during 2019-22 was led by business expansions with Bangalore, Hyderabad and Delhi as preferred cities.
According to the report, healthcare firms contributed to more than half of the LS sector expansions during 2019-22, followed by pharmaceutical companies with a share of almost one-third of expansions.
“More than three-fourths of the new entrants during 2019-22 were also from the healthcare sub-sector. Healthcare and medical devices were the prominent sub-sectors in Bangalore and Delhi-NCR during 2019-22, while pharmaceutical companies preferred Hyderabad, Chennai and Mumbai for office space take-up," it added.
Further, the report highlights that out of the total cumulated office space take up in India during 2019-22, American LS firms led the leasing activity with a share of about 56% followed by Europe, Middle East & African (EMEA) companies (24%), domestic players (19%) and APAC firms (1%).
Expansions constituted more than half of the space take-up by American LS corporates during 2019-22, followed by new entrants (30%). Space take-up by EMEA LS firms was also largely led by expansions (83%) followed by new entrants (13%).
The report further highlights that as of 2019, Gujarat housed the highest number of WHO-GMP certified pharma manufacturing plants followed by Maharashtra, Himachal Pradesh and Telangana. Further, Uttarakhand, Tamil Nadu, Karnataka and Andhra Pradesh are also major manufacturing hubs.
Telangana leads with the highest number of US-FDA certified plants, followed by Maharashtra, Gujarat, Andhra Pradesh, Karnataka and Tamil Nadu. Other states with a sizeable presence include Madhya Pradesh and Himachal Pradesh.
A further analysis of the type of operations revealed that while Gujarat is the topmost state for general manufacturing, Telangana is the leading state for analysis and API manufacturing.
