From Don Domoretsky
Executive Vice President, Life Science Practice
Stop us if you’ve heard this before: Greater Boston is the #1 life sciences cluster in the United States. If this sounds familiar, that’s because it’s happened before. In fact, since we began producing our annual life sciences report, no other region has held the top spot, and 2017 has proven no different.
An analysis of several factors including life sciences employment concentration and employment growth, VC funding, lab supply, NIH funding, average asking rent and more reveal that Greater Boston tops all other U.S. life science clusters. San Francisco is a close second followed by San Diego.
Here in Greater Boston, there are over 2,000 life science companies which have created more than 86,000 jobs. Of those totals, more than 50% can be attributed to R&D. Meanwhile, the industry’s strong sector continues to attract venture capital dollars, accounting for 30% of all life sciences funding across the U.S. last year.
Success doesn’t come without a price, however, as asking rents in East Cambridge have reached $75.05 and now top $70.00 in the up-and-coming Seaport lab district.
Outside the region, what all the clusters have in common though is an increasingly competitive landscape highlighted by three primary themes:
- Demand for highly skilled labor has led to sustained wage growth for life sciences employees. In the past 5 years, the average employee salary has increased 19.2% as human capital remains vital to growth at companies both big and small.
- As companies look to attract a new generation of employees, space is becoming a focal point of recruitment. In turn, companies are seeking out amenity-rich spaces in city centers or sprawling suburban campuses.
- Strategic partnerships for the purpose of drug development are becoming increasingly popular. Rather than re-invest in R&D, Big Bio and Big Pharma companies are acquiring innovation, accounting for 35% of venture funding.