Hyderabad among three preferred cities by life sciences firms

Hyderabad added one more feather in its cap by getting ranked as one among the top three preferred cities in India by the Life Sciences firms.

According to a report by the CBRE South Asia Pvt. Ltd, on–pan India basis, Hyderabad recorded a 19 per cent share in cumulative office space leasing by life sciences firms over the past four years. The report, ‘Life Sciences in India: The Sector of Tomorrow’ said the total office leasing during 2019-22 by LS firms in Hyderabad stood at 1.6 million sft, third highest after Bangalore and Delhi-NCR.

This was due to the presence of large LS clusters, grade-A office spaces, quality R&D labs, incubation centers, and research institutions in the city.

The CBRE report also said Telangana leads with the highest number of US-FDA-certified plants, followed by Maharashtra, Gujarat, Andhra Pradesh, Karnataka, and Tamil Nadu. Telangana also emerged as a leading state for analysis and API manufacturing.

While pharmaceutical companies preferred Hyderabad, Chennai, and Mumbai for office space take-up, medical devices were the prominent sub-sectors in Bangalore and Delhi-NCR during 2019-22.

The report highlighted Hyderabad attracting one of the biggest investments in 2022 by Biological E which announced an investment of Rs 1,800 crore in Genome Valley to expand three manufacturing facilities.

Further, healthcare and pharmaceuticals sub-sectors led the office space take-up by LS firms in Hyderabad over the past four years. About 57 per cent of the deal closures by LS firms in the city were led by small-sized deals (<50,000 sft).

Anshuman Magazine, Chairman & CEO – India, South-East Asia, Middle East & Africa, CBRE India, said, “Hyderabad remains one of the top cities in India to attract investments in LS sector. In our latest APAC Investor Intentions Survey 2022, healthcare-related properties overtook Data Centres (DCs) as most the most popular alternate segment.”

Year Leasing by LS Firms in Hyderabad (in mn. sft.)

• 2019: 0.3
• 2020: 0.1
• 2021: 0.6
• 2022: 0.6

Outlook for the next 3 years:

• New Supply: Bulk drug parks, medical device parks, pharma cities, and others are also likely to increase
• Space take-up: Space take-up is likely to increase led by pharmaceuticals, biotechnology, medical device and healthcare firms in the coming quarters.
• Rent: Rental growth to be led by the LS sectorial demand in the short to medium term and the resulting impact of fit-out costs.
• Fit out/construction cost: Costs are expected to continue to rise marginally as inflationary pressures are expected to abate in 2023.

Telangana Today