London’s Knowledge Clusters: Merging property, life sciences, & tech

London’s Knowledge Clusters*, a recently published report, looks at the looks at the role of evolving villages or ‘clusters’ based on the life sciences and associated industries including tech. The focus is on outlining opportunities for the property development sector.

The value of the life sciences to London, and the UK, cannot be underestimated. London’s life sciences now has over 1,300 companies, employs over 60,000 and has an annual turnover of £14.4 bn. This covers biotech R&D, healthcare, medical and optical equipment and pharmaceutical manufacture [See Medcity].

Why place matters

Knowledge ‘clusters’ are geographical locations which attract organisations from the knowledge economy with a clear focus is on intellectual capital. Being part of a cluster can create important opportunities for knowledge exchange. Integral to their success is that they become more than the sum of their parts.

Clusters tend to form around specific anchors such as hospitals or universities. They bring people together with a range of expertise, providing an ecosystem that if done right, can promote shared learning, collaborations and joint ventures.

And it is here that place matters. The right workspaces, both biology labs and office space, are critical to cluster developments. MedCity’s 2016 report, Planning for Growth – Demand for healthcare R&D space in London, shows that demand outstrips supply. Added to this is the challenge of high real estate costs.

London’s Knowledge Clusters

London’s Knowledge Clusters focuses on four business ecosystems King’s Cross / Euston, White City, Whitechapel and Sutton. It identifies the key opportunities and challenges for London’s real estate industry in these areas. These opportunities and challenges for each are unique.

For King’s Cross and Euston, there are clear challenges with space and cost. However, there are also real opportunities with being in close proximity of data and Artificial Intelligence based organisations like DeepMind. For developers, opportunities exists for first movers to benefit from meeting the demand for space for labs and workspaces, and for conveners in bringing together a range of people from across sectors.

For White City, the ambition is that it will become a district for invention, innovation and entrepreneurship. The challenges relate to having the lack of an ‘anchor’ organisation and limited space. Current opportunities for the property sector are limited, though this could change if there is an extension of the space available.

For Whitechapel, there are real opportunities with the area situated between London’s tech hub, the City, and the clinical expertise at the Barts NHS Trust. The challenges are with relatively slow progress being made on the life science campus, and competition from the other clusters. Opportunities for the property sector are in potentially partnering, and in supporting cluster growth through a hub and spoke model, with labs being the hub.

For Sutton, the ambition is to build the London Cancer Hub, the world’s leading life science cluster specialising in cancer research and treatment. The challenges are location, competition, and supporting growth. The opportunities for the property sector are to be potential developer partners, and in the medium to long term, taking advantage of opportunities that arise. This will particularly be the case if the General London Authority make the area an Opportunity and Intensification Area as part of the Mayor of London’s strategic vision for London.

What’s next?

How this plays out in a post-Brexit Britain remains to be seen. But what is clear is that cluster growth cannot happen in isolation.

There is a clear need for continued working across government including central government, the London General Assembly and local authorities, with universities and hospitals, and industries including property, and the life sciences. These will need to come together with local populations to ensure infrastructure is fit for purpose to meet needs and support growth.

*The report by Jack Sallabank, Future Places Studio, was commissioned by the London Property Alliance (CPA and WPA) and sponsored by British Land, Cushman & Wakefield and Derwent London.