2023 Asia Pacific Life Sciences Real Estate Trends

The growth of major life sciences companies has started to normalise after a period of significant growth during the height of the pandemic. While R&D spending will remain solid for new drug discovery, life sciences companies are looking to drive revenue growth in various ways. Cash-rich life sciences companies are looking to capitalise on falling valuations of biotech sector and medical device firms, whereas some are seeking to divest non-core businesses to focus resources on high growth areas.

Meanwhile, recent years have seen the proliferation of life sciences clusters in Asia Pacific to support the R&D operations of local and multinational firms. All of these trends combined with the growing demand for tech talent and the adoption of hybrid working are leading life sciences companies to rethink their real estate strategy. 

This report explores the latest life sciences real estate trends and their impact on real estate strategy. It also examines the latest developments in R&D Laboratory and Office portfolios, as well as investment demand.

R&D Laboratory Portfolios: As of the end of 2022, there was more than 100 million sq. ft. of R&D laboratory space in Asia Pacific. Solid leasing demand is driving the emergence of new life science hubs.

Office Portfolios: Most life sciences firms are seeking to keep costs under control and are therefore unwilling to add to their office portfolios. Workplace transformation and efficiency are a major focus.

Investment: Investment demand remains upbeat, with US$18 billion of funds raised for Asia Pacific life sciences real estate in the past five years. However, a shortage of assets for sale meant just US$717 million of direct investment was recorded in 2022.