Life Sciences Developer With Big Plans For The UK Raises £1.3B Of Fresh Equity

U.S. life sciences real estate developer IQHQ has raised $1.7B (£1.3B) of equity for a new investment push, a significant proportion of which will be targeted at the UK.

San Diego-based IQHQ raised the money through a private placement. Real estate investment manager CentreSquare Investment Management was a major investor in the raise, placing $158M with the firm. 

The equity placing means IQHQ has raised $2.5B in just nine months, having raised $770M earlier this year. The team is run by veterans in life sciences real estate, including Executive Chairman Alan Gold, who previously led sector giants Alexandria and BioMed Realty. 

IQHQ has a focus on speculative development and in the U.S. is targeting San Francisco, San Diego and Boston. Since raising its first slug of equity in February, it has completed five deals in those cities. 

But it also has plans to be an early mover in the burgeoning UK life sciences sector, and is targeting investment and development opportunities in the “golden triangle” of Oxford, Cambridge and London. 

The company’s strategy in the UK is led by Vice President for UK Real Estate Douglass Cuff. 

“In the UK, we are laser-focused on the tips of the golden triangle, so Oxford, Cambridge, London, and we are looking for projects where we can immediately get going and start and put a shovel in the ground as quickly as possible,” he told a Bisnow webinar in August. “Then, once this first round of assets is built and leased, we’ll then go public and be a very traditional REIT like [Nasdaq-listed] Alexandria, so we’ll be a long-term owner of the assets.

“We’re firm believers that in the UK it is only the beginning. Our focus is Cambridge, Oxford and London, but what Cambridge and Oxford have available is land, so there is space to build, unlike Cambridge, Massachusetts, where there is no space available, which is pushing the sector out of its traditional core.” 

He said demand in its markets in the U.S. is strong, and the UK is showing similar trends to the larger market across the Atlantic. 

“Get ready, because demand isn’t slowing,” Cuff said. “In a 20M SF market in Boston, there is not one tenant that’s struggling, and companies are bringing their supply chain into the U.S. so they are not reliant on Asia. Because of that level of demand, you are seeing new entrants into the market. When I started 20 years ago, there were only two players; now there are more than 20 in Boston alone.”