BioTech and Life Science companies are rushing to San Diego, and real estate developers are jumping to get included in the boom. The city is home to some of the top research institutions in the world and is attracting more and more investment.
The life sciences industry has seen rapid growth and there does not appear to be any signs of a slow down. This is because of new technologies and medical advancements that are moving from research to everyday life. The health system is being pressured by the pandemic, but this has also helped the life sciences industry grow at a rapid pace. The San Diego area’s life sciences employment grew to nearly 70,000 in 2020, an increase of 12% over the previous year. Meanwhile, the average asking rent for lab space in Sorrento Mesa, Sorrento Valley, and Torrey Pines has nearly doubled.
In a Times of San Diego article, Ted Jacobs of CBRE indicated the life science industry is an employees’ market. Employees can choose where to work, and San Diego’s laidback lifestyle is a draw for top talent looking for professional connections and rapid career growth.
The San Diego Business Journal reports that the San Diego real estate market is booming. According to Newmark vice chairman Matt Erskine, the investors are rushing to invest in the life sciences. Since the city has world-class research facilities, startups and established businesses are both adding lab space and hiring new people.
Elliot Adler, San Diego real estate developer, has seen investment opportunities, focusing on Del Mar Heights and La Jolla, areas in the robust life sciences development markets and where vacancies are already becoming scarce. “The vacancies resulting from the pandemic created rare opportunities in these areas that would otherwise be priced out,” says Adler.
Other real estate developers are taking a less-focused approach than Elliot Adler and purchasing properties distributed throughout Sorrento Mesa, Sorrento Valley, and Torrey Pines, where the life science sector has also seen an upsurge in development.
The Sorrento Mesa area has a lot of space. Almost 6.9 million square feet is available. But there are not many companies looking for space right now, as the vacancy rate is 5.7%.
Attention is rapidly moving toward adjoining submarkets like Del Mar Heights, an upscale neighborhood bordered by Solana Beach.