Life Sciences Outlook
Raleigh-Durham | 2015
Raleigh-Durham
The Raleigh-Durham life sciences cluster is familiarly called the
Research Triangle Region, due to the geographic nexus of the
area’s three leading research institutions: Duke University,
North Carolina State and the University of North Carolina at
Chapel Hill.
Orange County
North
Durham
The rich talent pool, stable socioeconomic structure, proximity
to universities and high quality of life has attracted major
players to the area. The Triangle’s universities and research
facilities continue to invest in expanding life sciences research.
Major lab supply:
Clusters of established lab stock with long-time industry presence
85
6 Forks
Falls of
Neuse
South
Durham
Route 1
Downtown
Durham
Emerging lab supply:
Areas with limited lab stock today that are poised for growth
Glenwood /
Creedmoor
40
RPT/RDU
Cary
West
Raleigh
Downtown
Raleigh
440
Life Sciences manufacturing supply:
Clusters of manufacturing space devoted to pharmaceutical, biological or
medical device & instrument manufacturing
East Raleigh
Downtown Durham
Downtown Durham is the new hub of the Life Sciences sector in the Triangle. Two high-profile projects, The Chesterfield and Durham ID, are
redeveloping the area to stimulate further growth. Duke University and Duke Medicine are the current anchor lab tenants in this submarket.
RTP/ RDU
RTP / RDU is home to nearly 75.0 percent of the region’s lab space. Agro-biotech firms have displayed strong growth in the past few years. This
submarket is home to four of the top five ag-tech companies, including Syngenta, Bayer CropScience, BASF and Monsanto. The area is seeing little
new lab supply under construction, along with increased demand for lab space, tightening the market. The majority of the lab spaces in this submarket
is owner-occupied and includes manufacturing space devoted to pharmaceutical, biological or medical device & instrument manufacturing.
West Raleigh
West Raleigh’s life sciences sector is clustered around the NC State University’s Centennial Campus. The Campus is a core research-oriented microregion, and the lab product is a mix of biotechnology and biomedical research, nanotechnology and advanced materials, environmental health, smart
systems and information technology.
JLL | Raleigh-Durham | Life Science Outlook | 2015
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Cluster score:
Economic scorecard
66.4
31,984
% life sciences to private
employment
5.3%
Year-overyear growth
17.9%
874
2.0%
4.9%
Total life sciences
% to total U.S.
VC funding
$295.0M
20.8%
NIH funding
$537.4M
2.4%
Innovation
Total life sciences
% to all patent classes
259
18.7%
Workforce
Total life sciences
Employment
Establishments
Funding
Patents
Universities in the Triangle
have pursued ways to spark
interdisciplinary
collaborations with the
private sector, creating new
public and private sector
jobs. Institutions like North
Carolina State University’s
Bio-manufacturing Training
and Education Center provide
training opportunities to
develop skilled professionals,
attracting firms looking for a
well-trained workforce.
Life sciences employment composition
Pharma & medicine manufacturing
7.0%
38.0%
24.0%
non-lab
using
Testing laboratories
20.0%
5.0%6.0%
1.5%
lab
using
Medical equipment & instruments
31.0%
68.0%
Electromedical instrument manufacturing
Medical equipment & supplies manufacturing
Life sciences
employment
31,981
Life sciences patents by classification
Life sciences
patents
259
As the local economy and
funding environment has
improved, multiple small and
early stage companies were
established in the past few
years. The vibrant local urban
environment has led to strong
in-migration of younger
generations of the workforce.
Strong ties between the
educational and private
institutions helped to recruit,
train and retain talent locally.
Pharmaceuticals & biotechnology
Research & development
Medical & diagnostic laboratories
Funding to support Research
and Development in the
market is a combination of
pubic and private sources.
The local universities have
helped researchers and
entrepreneurs build worldclass companies in the
Triangle. As one of the
hottest markets for Biotech
research, potential investors
will find this an attractive
market in which to invest.
Crop science
JLL | Raleigh-Durham | Life Science Outlook | 2015
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Raleigh-Durham
Downtown Durham
New mixed-use development
provides opportunities for
biotech firms
•
•
•
Downtown Durham, known for drawing technology and startups, is
bringing new high profile redevelopment projects that aim at
attracting life sciences and biotechnology companies.
The Chesterfield, a 284,000-square-foot historic building in
Downtown Durham, is being renovated to a mixed-use office and lab
facility. This seven-story former tobacco factory is expected to
complete its renovations by early 2016.
Durham Innovation District, a 15-acre project located west of
Downtown, will function as a research hub and collaborate closely
with Duke University. More than 115,000 square feet renovations of
laboratory space at Main Street and Carmichael Buildings are
planned.
RTP / RDU
Growth, driven by increased
investment, means new
developments are needed
•
•
•
•
RTP / RDU, known for its manufacturing and large headquarter
campuses, continues to experience steady growth. Leasing activity is
prominent among small and mid-tier area tenants, while mature
corporations are right-sizing based on their competitive landscape.
The investment and owner-user sales activity were on track with
previous years. Argos Therapeutics purchased their nearly
100,000-square-foot headquarters and manufacturing facility that is
currently under construction for $7.6 million from the developer, The
Keith Corp.
Locally, funding by investors is largely focused on the smaller drug
and medical device developers. Viamet, Sprout and Vascular are
some of the pharmaceutical firms that recently received funding. The
larger corporations continued to consolidate their positions with
mergers and acquisitions.
No new speculative lab developments have broken ground so
far, though there is a reasonable need for new lab facilities in
the market.
Facilities scorecard
Raleigh-Durham
Major lab
Supply
Rentable lab stock
(% of total stock)
9.92 m.s.f.
20.6%
Direct vacancy
(Change year-over-year)
16.5%
(1.8) ppts
# of large blocks over 100,000 s.f.
Under construction (s.f.)
23
0 m.s.f.
Demand
# of requirements
Total s.f. requirements
3
0.9 m.s.f.
Pricing
Average asking rent (NNN)
(Change year-over-year)
$18.98 p.s.f.
(3.4)%
QUINTILES
5927 S Miami Blvd
RTP / RDU
31,643 s.f.
Expansion in Imperial Center
Business Park
Syngenta Biotechnology
629 Davis Drive
RTP / RDU
94,915 s.f.
Renewal
701 W Main Street (The
Chesterfield)
Downtown Durham
284,000 s.f. available
Class A
*under renovation
ARGOS THERAPEUTICS
1733 TW Alexander Drive
RTP / RDU
Class A
97,500 s.f.
*investing $57 million in a new bio
manufacturing plant
Leasing
Under construction
Sales
Large blocks of space
Activity key:
JLL | Raleigh-Durham | Life Science Outlook | 2015
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For more information, please contact:
Mehtab Randhawa
Research Manager
Raleigh
+1 (919) 424-8459
[email protected]
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