The Life Sciences industry currently represents approximately seven percent of Canada’s GDP and employs a total of 400,000 people nationally. According to JLL, the industry will soon face ‘right-sizing’ trends, and thus demand smaller, more flexible workspaces.
“Investment capital is one of the primary challenges facing big pharma in Canada”, said Brett Miller, President of JLL Canada. “With the increasing trend of big pharma looking to right-size, partner or acquire smaller R&D firms, we can also expect the industry to start demanding smaller, more flexible space rather than large, multi-million dollar facilities.”
The 2014 JLL Global Life Sciences Cluster Report analyzes top life sciences clusters, ranks the cities for their prominence in the industry and also offers an analysis of global trends in 17 countries. Vancouver – the only Canadian city ranked globally and was named to the report’s Global Watch List: 10 cities in the spotlight.
Vancouver is described as having, “A rich infrastructure for biotech and research and development (R&D) that bodes well as the industry favors smaller, nimbler organizations.” Among the major Canadian cities with active life sciences industries, Vancouver has the greatest share of R&D jobs and tends to feature more start-ups and small to medium-sized companies, as opposed to large pharmaceutical campuses.
A main contributor to the industry is the R&D expenditures by big pharma firms such as Pfizer, GlaxoSmithKline, Merck, Novartis, Sanofi, AstraZeneca, and Roche.
With the increasing trend of big pharmas looking to right-size, partner or acquire smaller R&D firms, we can expect the industry to start demanding smaller, more flexible space rather than large, multi-million dollar facilities.
Moving forward, we expect investment capital to remain a challenge for Canadian life sciences firms.
The life sciences sector is estimated to contribute approximately $482 million to British Columbia’s annual GDP.
The provincial government offers tax credits and incentives for research, development, training and international transactions making British Columbia an ideal environment for investment in the life sciences sector.
- The UBC-Broadway Corridor is the second largest business and innovation hub in British Columbia behind downtown Vancouver.
- As the single largest provider of nursing graduates in British Columbia, BCIT provides the Burnaby submarket with health and technology professionals specializing in anatomy, behavioural science, microbiology, immunology, and communicable diseases control.
- Currently 165,000 square feet of laboratory space exists within three kilometres of the BCIT main campus.
Greater Toronto Area (GTA):
- The GTA is positioned in the middle of the second largest life sciences cluster in North America, the Québec-Ontario Life Sciences Corridor.
- Currently, the Corridor hosts more than 1,100 companies, 66,000 qualified professionals and 490 educational programs in the biological and biomedicine sciences. In 2013, GTA’s life sciences industry alone saw more than $36 million in investment funds.
- The market has witnessed manufacturing jobs moving overseas to countries with lower labour and manufacturing costs, and the centralization of R&D around areas with the best access to resources.
With Canada’s economic recovery, the life sciences sector in the GTA has already begun its rehabilitation.
- Located in the heart of downtown Toronto, the Discovery District holds one of North America’s largest clusters of research institutes, related business incubators and support services. With over 7.0 million square feet of facilities, the district has a reputation for medical and technological breakthroughs, notably in areas such as breast cancer cardiovascular diseases, Alzheimer’s, and cystic fibrosis research.
- The industry’s prosperity in Downtown Toronto has been driven by employment growth, inter-provincial cooperation, a state-of-the-art research cluster, and the benefits of a reputation as one of the top global environments for discovery, innovation, and success.
- Boasting positive absorption of over 100,000 square feet almost every quarter over the last five years. The best performing life sciences sector in Mississauga is R&D which has more than doubled the number of companies over the past 10 years.
- Testing laboratories and pharmaceutical wholesalers/distributors have also seen growth with 79.0 percent and 51.0 percent increases in employment respectively since 2001.
- Mississauga has seen a 24.0 percent increase overall in the number of life sciences companies and a 10.4 percent increase in employment since 2001. These positive trends are expected to continue as industry confidence and investment flows to the GTA and the Quebec-Ontario Life Sciences Corridor.
Greater Montreal Area (GMA):
- Over 35,000 jobs across 630 organizations, of which 15.0 percent are foreign-owned companies. In real estate terms, this translates to over 18.0 million square feet of office, industrial and lab space.
- There are three major hospitals and R&D facilities currently under construction in and around downtown Montreal. The sites represent over $5 billion in investments and are scheduled for completion over the next five years.
- The $52 million invested in Montreal’s life science industry this year accounted for just over 20.0 percent of total Canadian equity investments.
- The city of Montreal still offers one of the lowest corporate tax rates for companies and attractive fiscal incentives for businesses with a strong emphasis on R&D.
- The West Island submarket remained the largest and most active GMA life sciences cluster in 2013. There are approximately 9.0 million square feet of office, industrial and lab space occupied by companies in the Life Science industry in the West Island, of which 29.0 percent are owner-occupied and 71.0 percent are leased by tenants
- Laval’s life sciences cluster continues to attract organizations looking for newer buildings. Within Laval, the ‘Biotech City’ is the submarket’s primary biotechnology cluster, employing over 5,000 people across 90 organizations.
Feature Image: JRSFHC via Vancouver Coastal Health