Life Science Industry Set Record Pace in 2021
As we closed the books on year two of the COVID-19 pandemic, the life sciences market set records as the strongest in history.
While overall non-farm employment grew 4.5% in 2021, biotech R&D employment jumped 10.8%, according to CBRE’s Q4 report. In the last five years, life science employment has grown 20% in total and new jobs are being added each week. As of this writing, BioSpace has 8,640 job openings listed with biopharma companies across the country.
Mirroring the residential real estate market, lab space remains a hot commodity for these growing companies too. National average rent prices keep pushing up, rising 7.8% just during the 4th quarter of 2021. Vacancies dropped and the number of tenants seeking spaces went up from Q1 to Q4. The total demand for square footage is 23.5 million, driving up the under-construction lab space square footage 67% from the beginning of the year.
Life science hub Genetown, the Boston/Cambridge area, racked up the biggest numbers reported. With nearly 45 million square feet of lab space inventory, the site only has a 1.3% vacancy rate and has the highest average asking rents in the country. The hopping life science scene also boasts the highest number of square footage currently under construction for labs and R&D at over 11 million, with 41% of it already pre-leased.
It’s no surprise that the east coast port is booming. Over 3,100 life science companies have locations there, including big names like AbbVie, Biogen, and pandemic heroes Pfizer and Moderna. The average salary for the area is more than $140,000.
Over the course of the year, venture capital funding for the life science sector remained in the record-high range at $32.5 billion, according to CBRE. In 2020, those VC investments hit a new peak at $36.6 billion in the face of the novel coronavirus. The first two years of the pandemic also saw an incredible number of IPOs for biopharma. This trend has slowed down as the market has taken an unkind turn away from biotech stocks, resulting in some later series, higher dollar VC funding rounds.
While the biotech stock has taken a tumble, experts believe the 2022 market is ripe for mergers. While big names have massive war chests itching to be tapped into, the smaller guys’ stock has been yanked down to attractive prices. Belgian company UCB has already snapped up U.S. rare disease company Zogenix in a $1.9 billion deal.
One thing is clear from this report. The Life Science industry is stronger than ever and a great place to grow your career right now.
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