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JLL Life Sciences Report ranks Seattle as a strategic location
Seattle, Feb. 20 2013— With a series of key brand-name drug patents set to expire in 2013, deadlines collectively referred to as the “patent cliff,” life sciences companies are bracing themselves for a revenue drop some estimate could reach $30 billion. One industry response to the cliff is the geographic reshuffling and right-sizing of the North American life sciences industry occurring in comparatively smaller metropolitan areas as these cities rise in industry influence. Jones Lang LaSalle’s (JLL) annual 2012 Life Sciences Cluster Report chronicles this shift in a ranking of industry clusters—areas in which life sciences intellectual capital, funding and facilities are concentrated. Cities that are rising in influence offer a workforce, academic community and public sector focused on R&D productivity and areas of opportunity within the sector, such as biologic biosimilar drug research and production.
Seattle is ranked 10th in the 2012 Jones Lang LaSalle Life Sciences Cluster Report out of a total of 21 U.S. regions, according to weighted scores for total employment in high-tech research and hospital/medical fields; life science establishments; National Institutes of Health (NIH) funding; and venture capital funding.The report based on information compiled in 2012 compares the top 10 U.S. markets for life sciences with results from the previous years, along with detailing the following emerging trends:“Access to world-class research institutions, facilities and intellectual capital are priorities for R&D-focused organizations,” said Patricia Raicht, Director of Research for the Seattle and Portland markets, Jones Lang LaSalle. “Proximity to these resources, continues to command a premium in terms of rents and facilities investments.” The importance of access to a thriving and diverse community focused on innovation has never been greater. According to Deloitte’s 2012 The Future of the Life Sciences study, “Significant revenue growth is unlikely to be achieved organically, mergers and acquisitions will continue, and partnerships/alliances will emerge as an important means of revenue generation. Companies will need to leverage the fact that partnerships will be ubiquitous and may include cross-sector partnerships and collaborations with payers as well as academia.”
While not offering the critical mass of the established clusters, emerging U.S. life sciences concentrations are stepping up their economic development and public-private partnership activities to attract life sciences organizations. “Certain emerging clusters have adopted the ‘if you build it, they will come’ mentality, combining targeted incentive packages, new facilities, economic development groups and public-private partnerships in concerted efforts to attract life sciences companies,” said Raicht. “These incentives are important as life sciences companies balance their need to be near world-class scientific institutions versus their need to manage facilities costs.”
Seattle region:Seattle has one of the fastest growing life sciences markets in the nation and has become one of the core cancer research markets in the nation. Puget Sound’s life sciences is comprised of nearly 1,000 firms employing more than 22,000 directly in the industry, with an additional 191,000 people employed in the hospitals and the medical field. One of the distinguishing features of the Seattle-area life sciences market is that very little manufacturing is done in the region. Nearly all Puget Sound-area life sciences industry activities are based on research and development. Unlike areas with a strong concentration of life sciences manufacturing jobs, when a growing Puget Sound company is purchased by a larger company, the frequent trend has been the employees and the companies to remain intact and local to Seattle. This is the case with many companies like Zymogenetics, which was acquired by Bristol-Myers Squibb in 2010; Blue Heron, which was acquired by OriGene Technologies in 2010; and Sonosite, which is being acquired by Fujifilm.
At 4.6 million square feet the Seattle life sciences market is a smaller market with a high density of companies situated in its two core markets of South Lake Union and Bothell. Seattle has a dynamic mix of life sciences companies both private and public who serve a vast array of activities from cancer research to drug research. The University of Washington Medicine, Fred Hutchinson Cancer Research, Seattle Cancer Care Alliance, Seattle Genetics, Amgen and Bristol-Myers Squibb all are staples of excellence in the market and have seen significant growth over the last decade. A major contributor to Seattle’s life sciences growth can be attributed to industry leading research coupled with generous funding by some of the world’s largest philanthropic organizations, like the Bill & Melinda Gates Foundation.
“Three key factors have helped both established and emerging clusters to achieve success during rapidly changing times,” said Raicht. “According to the report, middle market growth and M&A’s are benefiting smaller metropolitan areas.”
“The report also said that proximity to innovation is more important than ever and that economic development and public private partnership activities are stepping up to attract life sciences organizations,” added Raicht.
“Certain emerging clusters have adopted the ‘if you build it, they will come’ mentality, combining targeted incentive packages, new facilities, economic development groups and public-private partnerships in concerted efforts to attract life sciences companies,” added Raicht. “These incentives are important as life sciences companies balance their need to be near world-class scientific institutions versus their need to manage facilities costs.”
The complete findings of Jones Lang LaSalle’s 2012 Jones Lang LaSalle Life Sciences Cluster Report for Seattle is available in a dedicated microsite available here: http://www.joneslanglasalle.com/Documents/life_science_report/pdf/Seattle.pdf
A PDF of the report can be downloaded here: http://www.us.am.joneslanglasalle.com/UnitedStates/EN-US/Pages/ResearchDetails.aspx?ItemID=10401
Background on study sponsor: Jones Lang LaSalle has a team of real estate and facility management experts dedicated to helping life sciences companies optimize and manage their real estate portfolios. The firm provides a comprehensive range of facilities management services to the life sciences community covering 70 million square feet of research, manufacturing and commercial space. Jones Lang LaSalle’s industry leading full-service platform includes: integrated facilities management, engineering and operations, energy and sustainability, transaction advisory services, lease administration, project management and a new platform for integrating laboratory services, Labwell.
A leader in the real estate outsourcing field, Jones Lang LaSalle’s Corporate Solutions business helps corporations improve productivity in the cost, efficiency and performance of their national, regional or global real estate portfolios by creating outsourcing partnerships to manage and execute a range of corporate real estate services. This service delivery capability helps corporations improve business performance, particularly as companies turn to the outsourcing of their real estate activity as a way to manage expenses and enhance profitability.
For more news, videos and research resources on Jones Lang LaSalle, please visit the firm’s U.S. media center Web page. Bookmark it here: http://www.us.am.joneslanglasalle.com/UnitedStates/EN-US/Pages/News.aspx
About Jones Lang LaSalle Jones Lang LaSalle (NYSE:JLL) is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. With annual revenue of $3.9 billion, Jones Lang LaSalle operates in 70 countries from more than 1,000 locations worldwide. On behalf of its clients, the firm provides management and real estate outsourcing services to a property portfolio of 2.6 billion square feet. Its investment management business, LaSalle Investment Management, has $47.0 billion of real estate assets under management. For further information, visit www.jll.com.
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