For years the Thames Valley has been heralded as the UK’s Silicon Valley; inward investment from US-parented technology companies has driven names like Microsoft and Cisco to the region.
But as the economy hits tougher times and commercial property players reassess the true sources of demand, are they waking up to a forgotten market?
15 of top 25 UK pharmaceuticals are based in the Thames Valley
Impressively, of the top 25 pharmaceutical businesses in the UK, 15 are located in the Thames Valley. Furthermore, over the last five years the pharmaceutical sector has been responsible for over 1.1 million sq ft of office space take-up within the region. While this market presence shouldn’t come as a revelation to those working in Thames Valley commercial property, there certainly needs to be wider recognition of this pharmaceutical influence.
Thames Valley: what is the attraction for pharmaceuticals?
So, what are the reasons behind this prevalence? Recent market analysis conducted by our Thames Valley Office Agency team ascertained the main reasons as being the proximity to Heathrow and M4 transportation links. The former being a facilitator of overseas travel for clinical research, and the latter linking the Thames Valley ‘hub’ to the South Coast, South West, Wales and London.
The size of office buildings available in the Thames Valley and their associated rents compared to London was also cited as a driver behind pharmaceutical demand. This is in addition to the skilled workforce coming out of Oxford and Reading Universities.
Not a new market - far from it
Of the pharmaceutical businesses that confidentially briefed LSH on their property drivers, on average their business presence in the region is 15 years. In fact, some of the pharmaceutical businesses have established specialist research and laboratory facilities which, by their nature, demand long term occupation.
This has generally been overlooked by Thames Valley market commentators, however, with pharmaceuticals being historically eclipsed by the perceived dominance of the Silicon TMT brigade. But this is not a new market; far from it.
Wider understanding of demand sources needed
The truth is that this sector has always been flourishing within the region and its increased visibility and perceived activity is more a result of the demise of TMT activity, not a structural inward investment shift from the sector. Now more than ever there therefore needs to be wider, more in-depth understanding of these prominent demand sources for the region by commercial property landlords.
To view a heatmap of pharmaceutical prescence in the Thames Valley, click here.