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Tishman Speyer Buys Big in Cambridge Life Sciences, But £17B Is Still Looking For A Home

Kings College, a Cambridge landmark

Breakthrough Properties, the life sciences vehicle created by Tishman Speyer and Bellco Capital, has made its second UK purchase, buying the Vitrum Building, St. John's Innovation Park in Cambridge.

But most investors won't be so lucky: JLL figures show around £17B of capital could go unallocated, thanks to lack of investable opportunities.

The 42K SF Vitrum block, built in 2004, sits on a 1.8-acre plot at the 21-acre park, where demand for lab space is high. Rents at Vitrum are around £30 per SF, meaning the site is ripe for redevelopment.

Cambridge prime rents are now hovering over £40 per SF. In Oxford, rents have already topped £48 per SF.

The move is one of a series of Breakthrough buys in the Oxford-Cambridge-London golden triangle. In January the firm bought the 1.7-acre Trinity House cluster on the 88-acre Oxford Business Park.

The latest buy means Breakthrough has a 4.6M SF development pipeline on both sides of the Atlantic.

The move comes days after Breakthrough announced it had raised $3B to acquire and build new lab space across the U.S. and Europe. The successful funding coincided with Brookfield’s creation of a new life sciences property platform embracing its 1.6M SF UK portfolio, as JLL reported £20B capital chasing UK life sciences property.

The odds are that most investors — to the tune of about £17B worth of capital — will come away disappointed thanks to the lack of investable opportunities. “The weight of capital from investors is higher than ever at £20B, a 25% increase from 2020. Given only £2.4B was deployed in 2021, there is a significant amount of capital yet to be deployed,” JLL said.

Although the U.S. market weighed in at £9B ($12B) transacted in 2021, this was up only 17.3% on 2020 figures, making the UK a faster grower.