Growth in the life sciences sector has directly translated into increased demand for lab space across major markets including New York (NYC).
The life sciences industry has steadily expanded its footprint in NYC over the past several years with state and city incentives continuing to encourage developers to build labs for medical research. In 2021, the city government announced a doubling of its investment into the sector — $1 billion — to accelerate its growth: $430 million for new laboratory and incubator construction; $450 million for non-profit facilities; and $20 million for internship programs and start-up ventures.
Within the next five years, 2.6 million square feet of life sciences space is expected to be delivered including Alexandria Center’s North Tower, Botanic Properties’ 270,000 square-foot redevelopment of 24-02 Queens Plaza South, and Taconic Partners’ 399,000-square-foot redevelopment of 125 West End Avenue.
Nationally, life sciences employment has continued to fare better than the U.S. job market with year-over-year growth up 7.9% and 11.4% in 2020 and 2021, respectively. Since 2011, total U.S. employment growth has averaged 1.0% per year while life sciences employment has increased by 6.6% per year, on average. The top 10 life sciences MSAs account for 45% of the U.S. life sciences talent pool led by Boston, NYC-NJ, San Francisco, Philadelphia and San Diego.
Investors and developers worldwide continue to grow their presence in NYC as it has one of the most educated and diverse talent pools in the nation along with first class academic and medical institutions and premier venture capital ecosystems. Since 2001, New York has experienced a 144% increase in life sciences employment, with the employment and talent pool reaching 58,200 current and potential employees.
New York City is a rapidly growing recipient of life sciences investment capital, with venture capital funding in 2021 climbing to $6.2 billion, the highest level on record and a 52.6% increase over 2020.