Life Sciences Real Estate Market Size, Share, Growth and Industry Analysis by Type (Lab Space Real Estate and Bio-manufacturing Facilities) By Application (Temporary Hospitals, Housing for Healthcare Workers, Laboratory Space, Bio-manufacturing Facilities, And, Others) Regional Insights and Forecast to 2034

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LIFE SCIENCES REAL ESTATE MARKET OVERVIEW

Life Sciences Real Estate Market Size is forecasted at USD 3.75 billion in 2025, increasing to USD 4 billion in 2026 and approaching USD 6.76 billion by 2034, reflecting a CAGR of 6.76% over the forecast period 2025-2034.

The term life sciences real estate describes facilities specifically built to house operations of biotechnology firms and pharmaceutical operations together with research companies. The buildings contain scientific spaces that include laboratories and research facilities and innovation hubs together with modern infrastructure for breakthrough research. Real estate demand for these properties has increased because healthcare facilities together with biotechnology and medical innovation sectors are receiving more funding. Top Research institutions along with biotech firms reside in Boston, San Francisco and San Diego while constituting the primary life sciences real estate markets. Life sciences real estate demands special design needs along with high-tech ventilation systems and safety regulations thus have become a growing but distinct subsector of commercial real estate properties.

KEY FINDINGS

COVID-19 IMPACT

Vaccine Development Together With Diagnostics and Treatments during Pandemic Increased Market Growth

The global COVID-19 pandemic has been unprecedented and staggering, with the market experiencing higher-than-anticipated demand across all regions compared to pre-pandemic levels. The sudden market growth reflected by the rise in CAGR is attributable to market’s growth and demand returning to pre-pandemic levels.

The COVID-19 pandemic increased life sciences real estate demand dramatically since investors poured money into biotech together with pharmaceuticals and medical research sectors. To speed up vaccine development together with diagnostics and treatments companies needed an expansion of their laboratories and manufacturing facilities. Research institutions coupled with biotech startups received additional funding which accelerated the expansion of specialized facilities. The markets of Boston together with San Francisco demonstrated increasing real estate rents and minimal spaces available for tenants. Laboratory infrastructure featuring adaptable functionality together with advanced ventilation and safety measures gained increased importance because of the pandemic thus demonstrating the sector's ability to grow sustainably despite emergencies.

LATEST TRENDS

Eco-Friendly Laboratories Are Emerging Through the Development Of Industry Standards to Accelerate Market Growth

The real estate market dedicated to life sciences continues to show significant market trends. Eco-friendly laboratories are emerging through the development of industry standards due to the increasing importance of sustainability along with new requirements from the Corporate Sustainability Reporting Directive. Financial confidence returned to support fundraising success at Quotient Therapeutics which subsequently increased both development transactions and improved business partnerships among owners and tenants. A market consolidation occurs due to investor understanding of complex sector requirements which leads to shared laboratory facilities that reduce operational challenges for small businesses. An effort exists to enhance planning system integration for optimized laboratory development operations. These trends are driving the Less- life sciences real estate market growth.

• According to the U.S. Green Building Council (USGBC), over 55% of new life sciences laboratories constructed in 2023 in the U.S. adopted green building standards with LEED certifications.

• The European Environment Agency (EEA) reported that nearly 40% of new real estate projects in biotech clusters across Europe now integrate eco-friendly ventilation and energy-efficient designs.

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LIFE SCIENCES REAL ESTATE MARKET SEGMENTATION

By Type

Based on Type, the global market can be categorized into lab space real estate and biomanufacturing facilities

• Lab Space Real Estate: With increasing demand for R&D, modern lab spaces now feature flexible layouts, high-tech ventilation, and sustainable designs. Major biotech hubs like Boston and San Diego continue to see high occupancy rates as innovation drives growth.

• Biomanufacturing Facilities: The rise of personalized medicine and cell and gene therapy has fueled the need for advanced biomanufacturing spaces. These facilities require specialized infrastructure, such as cleanrooms and automation, to support large-scale drug production efficiently.

By Application

Based on Type, the global market can be categorized into temporary hospitals, housing for healthcare workers, laboratory space, biomanufacturing facilities, and, others

• Temporary Hospitals: During health crises like COVID-19, temporary hospitals provide emergency medical care by repurposing convention centers or modular units. These facilities help manage patient overflow and enhance healthcare system resilience.

• Housing for Healthcare Workers: Proximity to medical facilities is crucial, leading to an increased demand for affordable, short-term housing for healthcare workers. These accommodations offer convenience, reducing commute times and improving staff well-being.

• Laboratory Space: Modern laboratories are designed with adaptable layouts, high-tech ventilation, and sustainable features to support evolving research needs. The demand remains high in biotech hubs, driven by advancements in pharmaceuticals and diagnostics.

• Biomanufacturing Facilities: Facilities for large-scale drug and vaccine production require cleanrooms, automation, and specialized infrastructure. The growth of personalized medicine and biologics has increased investment in these spaces.

• Others: This category includes medical office buildings, research incubators, and hybrid healthcare spaces. These facilities support interdisciplinary collaboration, innovation, and efficient patient care delivery.

MARKET DYNAMICS

Driving Factors

Developments in Biotechnology Combined With Gene Therapy and Personalized Medicine to Amplify Market Growth

High-technology developments in biotechnology combined with gene therapy and personalized medicine result in increasing requirements for specialized property assets. To perform leading-edge research and production companies need current facilities for laboratories along with biomanufacturing units. The development of mRNA vaccines together with CRISPR gene editing and AI-driven drug discovery purposes requires immediate high-tech infrastructure expansion. Research institutions jointly working with private firms has resulted in creating innovation centers across Boston and San Francisco where new leasing trends in biotech clusters become prominent. The growth of scientific achievements will expand the necessity for adaptable life sciences facilities with enhanced capabilities. All of the above-mentioned factors are driving the life sciences real estate market share.

• According to the National Institutes of Health (NIH), U.S. federal funding for biomedical research exceeded USD 47 billion in 2023, creating continuous demand for modern laboratory spaces.

• The World Health Organization (WHO) highlights that more than 70% of global pharmaceutical innovation hubs are concentrated in developed markets, fueling high demand for life sciences real estate.

High Levels of International Investment Dedicated To Healthcare and Life Sciences Research to Propel Market Growth

High levels of international investment dedicated to healthcare and life sciences research functions as a primary driver behind growing real estate needs. Public agencies with venture capital firms and pharmaceutical businesses direct their funding streams to support R&D that needs modern drug development facilities alongside clinical testing centers and manufacturing sites. Public health needs that include pandemic preparedness and caring for aging populations drive additional spending into healthcare and life sciences real estate. The growth of biotechnology clusters receives support from funding programs paired with tax incentives. Life science real estate development and property conversions receive support from new capital inflows which promotes industrial innovation while enhancing specialized buildings. The above mentioned factors are contributing to the rapid growth and development of the market.

Restraining Factor

Boilerplate Infrastructure Expenses That Enhance Construction Expenditures to Decrease Market Growth

Specialized facilities and advanced ventilation systems together with cleanrooms cannot function without strict adherence to safety regulations in life sciences real estate. Boilerplate infrastructure expenses enhance construction expenditures coupled with operational expenses when compared to conventional office facilities. Operating laboratory spaces requires ongoing spending for facility upgrades together with energy conservation measures and replacement of equipment. High costs create obstacles that prevent numerous small biotech startups from acquiring their desired locations leading to slower expansion. Complex financing and leasing exists for developers together with investors because they need to match affordability concerns with functional requirements in industries that face changing research timelines and unpredictable funding periods.

• According to the U.S. Department of Energy (DOE), energy costs in laboratory facilities are 3 to 5 times higher than traditional office spaces, straining operating budgets.

• The European Commission noted that 42% of small biotech firms in Europe face delays in expansion due to high compliance costs and infrastructure expenses.

Innovative Research Facilities Uniting Laboratories With Incubators And Workplaces to Create an Opportunity in the Market

Opportunity

Innovative research facilities uniting laboratories with incubators and workplaces have become essential because of mounting development and scientific research requirements. The academic and biotech systems of Boston along with San Diego experience rising spending in life sciences infrastructure. The transformation of vacant commercial structures into lab facilities offers developers a profitable business prospect. The modern push for sustainable as well as smart buildings provides investors with opportunities to develop energy-efficient designs coupled with advanced automation features which enhance operational efficiency and long-term property value. These factors are creating several opportunities in the market that help propel its rapid development.

• The U.S. Census Bureau projects that by 2030, over 20% of the U.S. population will be aged 65+, driving demand for biotech and healthcare research spaces.
• According to the Asia Pacific Economic Cooperation (APEC), biotechnology research investments in Asia grew by 35% between 2019 and 2023, creating significant opportunities for new lab and biomanufacturing facilities.

Ongoing Problem of Inadequate Property Availability Which Satisfies Its Specialized Requirements to Create Challenge in the Market

Challenge

The life sciences market faces an ongoing problem of inadequate property availability which satisfies its specialized requirements. General office building conversions into laboratories and biomanufacturing facilities become unnecessarily complex and costly because specialized infrastructure elements such as reinforced flooring and enhanced ventilation systems and biosafety requirements are necessary. The high demand in important biotech centers has increased rental rates and diminished vacant premises. Life sciences companies together with developers encounter substantial challenges when searching for appropriate sites that meet standards for affordability and operational accessibility and regulatory compliance. The above-mentioned facts could hinder the market growth and pose a threat to the market.

• The National Council of Real Estate Investment Fiduciaries (NCREIF) reported that vacancy rates in prime biotech hubs like Boston and San Francisco fell below 5% in 2023, creating a supply shortage.
• According to the World Bank, construction material costs increased by 18% globally in 2022, raising barriers for new life sciences real estate projects.

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LIFE SCIENCES REAL ESTATE REGIONAL INSIGHTS

• North America

The life sciences real estate market in North America maintains its prominent position because Boston, San Francisco and San Diego establish its growth engine. Biotech startup funding alongside pharmaceutical research has caused an increased need for lab facilities and biomanufacturing facilities. The cities of Toronto along with Raleigh-Durham have developed into significant life sciences centers. The conversion of commercial spaces into research laboratories shows rising popularity alongside continuous government fund allocation and venture capital support in high-tech healthcare facility growth.

• Europe

There is an expanding trend in life sciences real estate throughout Europe's regions which includes UK’s Golden Triangle (London, Oxford, Cambridge) and Germany together with Switzerland. Governments alongside private investors currently support biotechnology innovation which enhances the market demand for laboratories alongside research facilities. Sustainable development initiatives are becoming increasingly popular as green buildings and energy-efficient laboratory facilities are emerging standards. Life sciences infrastructure growth becomes faster through startup and pharmaceutical industry joint ventures within innovation districts which help tackle zoning and regulatory barriers in major European cities.

• Asia

The Asia Pacific shows fast-moving growth in life sciences real estate development because of biotechnology investments supported by regional governments. China leads with Singapore and India along with their established biotech parks and research areas that have brought numerous pharmaceutical companies to establish operations. The cities of Shanghai and Hyderabad maintain growing needs for laboratory and manufacturing facilities because their research and development sectors expand. The advancing focus on digital health technologies coupled with AI-driven research patterns requires professionals to create advanced technologically enabled life sciences real estate solutions.

KEY INDUSTRY PLAYERS

Leading Players adopt Acquisition Strategies to Stay Competitive

Several players in the market are using acquisition strategies to build their business portfolio and strengthen their market position. In addition, partnerships and collaborations are among the common strategies adopted by companies. Key market players are making R&D investments to bring advanced technologies and solutions to the market. Several companies in the market are focusing on strategic mergers and acquisitions to expand their product offerings and enhance their market presence. Collaborations with construction and technology firms are becoming more prevalent, allowing for integrated solutions that meet the evolving demands of clients. Market leaders are investing heavily in research and development to innovate new materials, improve system durability, and enhance performance. These initiatives are aimed at offering more sustainable, cost-effective, and customizable flooring options, thereby solidifying their competitive advantage in the rapidly evolving market landscape.

• Alexandria Real Estate Equities (U.S.): According to company disclosures, Alexandria manages more than 41 million rentable square feet of life sciences real estate across the U.S., making it the largest operator in the sector.

• Blackstone Real Estate (U.S.): As per U.S. Securities and Exchange Commission (SEC) filings, Blackstone invested over USD 20 billion in life sciences properties by 2023, holding a significant share in biotech hubs like Cambridge and San Diego.

List Of Life Sciences Real Estate Market Players Profiled

• Silverstein (U.S.)
• Deerfield Management (U.S.)
• Blackstone Real Estate (U.S.)
• Cornish & Carey Commercial Inc (U.S.)
• BioMed (U.S.)
• Taconic (U.S.)
• King Street Properties (U.S.)
• Avison Young (Canada)
• Janus Property Co. (U.S.)
• Acorda Therapeutics (U.S.)
• Thor Equities (U.S.)
• Alexandria Real Estate Equities (U.S.)

INDUSTRIAL DEVELOPMENT

October 2024: Life sciences real estate market saw substantial product innovations in 2024 when wellness-oriented residential projects started gaining prominence. The Well in Miami showcases luxury development through its health focus by providing residents with hydroponic gardens and lymphatic draining showers together with designated areas for meditation. Wellness real estate has emerged as a new development direction which integrates upscale residential spaces with complete health-centered features across communities. The worldwide wellness real estate market achieved $438 billion in 2023 values and experts predict it will exceed $913 billion by 2028 reflecting strong market expansion along with rising customer interest in wellness-oriented residential choices. ​

REPORT COVERAGE

The study encompasses a comprehensive SWOT analysis and provides insights into future developments within the market. It examines various factors that contribute to the growth of the market, exploring a wide range of market categories and potential applications that may impact its trajectory in the coming years. The analysis takes into account both current trends and historical turning points, providing a holistic understanding of the market's components and identifying potential areas for growth.

The research report delves into market segmentation, utilizing both qualitative and quantitative research methods to provide a thorough analysis. It also evaluates the impact of financial and strategic perspectives on the market. Furthermore, the report presents national and regional assessments, considering the dominant forces of supply and demand that influence market growth. The competitive landscape is meticulously detailed, including market shares of significant competitors. The report incorporates novel research methodologies and player strategies tailored for the anticipated timeframe. Overall, it offers valuable and comprehensive insights into the market dynamics in a formal and easily understandable manner.