San Diego Life Science Industry Leaps Ahead, Real Estate Benefits
The life science industry in San Diego has been kicking into even higher gear lately, with capital pouring into the market and employment in the sector up. This dynamic is driving demand for specialized space.
During the first quarter, venture capital investors put $547.2M into 37 startups in San Diego County, according to the Venture Monitor Report, published by the National Venture Capital Association and PitchBook. That is about 4% higher than a year earlier, and much of that total went to the life science industry.
Biotechs and other healthcare companies represented seven of the top 10 deals in the region, the report said, more than $360M, or almost two-thirds of the total.
"The city attracts VCs and angel investors, as well as many large pharmaceutical companies, such as Johnson & Johnson and Novartis,” California Life Sciences Association President and CEO Sara Radcliffe said.
Late last year employment in San Diego County’s life science industry surpassed Orange County for the first time, putting the area at No. 3 in the state as a life science employment node, CLSA data shows. Almost 50,000 people hold direct life sciences jobs in San Diego County.
The city’s biomedical community showed the most significant growth, with 12.5% growth in biopharmaceutical jobs, 21.9% growth in medical device jobs and 10% growth in R&D employment in 2017 compared with the previous year, according to the CLSA's 2018 California Life Sciences Industry Report.
"With 15M SF of laboratory space, San Diego is, and we are confident will remain, one of the top three life science markets in the world," BioMed Realty Senior Director of Leasing, San Diego Kevin Tremblay said.
BioMed is a life science property specialist whose portfolio includes about 12M SF in major U.S. life science markets, including Boston, San Francisco, San Diego, Maryland, New York and Seattle, as well as Cambridge in the U.K. It has 26 properties in the San Diego market.
"We expect continued growth driven by proximity to academic and research institutions, such as UC San Diego, the Salk Institute, Sanford Burnham Prebys and Scripps Research," Tremblay said.
Tremblay said the market has a highly skilled workforce and, more importantly, a healthy community of life sciences companies of varying sizes and wide ranges of scientific focus, including Illumina, La Jolla Pharmaceuticals and Human Longevity.
San Diego life science also boasts a location quotient of 1.98. Location quotients, as calculated by the Bureau of Labor Statistics, compare regional industry employment levels to the U.S. overall. A quotient greater than 1.2 indicates a competitive advantage for a region. San Diego's is well above that, and has increased from 1.81 in 2011.
"We continue to invest in San Diego’s life science industry with new developments, such as the 137K SF Center for Novel Therapeutics in the UC San Diego Science Research Park, now under construction, and over 500K SF of planned development and redevelopment projects scheduled to be delivered over the next two years," Tremblay said.