New Study Sets Course To Position Houston As A Top 10 Life Sciences Destination
Houston is an ideal place for life sciences businesses to set up shop, according to a new study laying out a road map to draw even more of them to the metro. But whether they will follow is yet to be determined.
A study released this month by the Greater Houston Partnership and commissioned by Newmark Consulting Group determined Houston has the infrastructure, workforce and community support needed to crack the top echelon of life sciences markets.
It will have to put in some work to get there, though, according to both the study and those marketing Houston life sciences real estate.
“The ecosystem for life sciences real estate in Houston was, and still is, fairly small, surprisingly, given the size of just the population we have and the fact we have the largest medical center in the world right here,” Partners Real Estate Senior Vice President Holden Rushing told Bisnow.
Partners’ staff, which includes a life sciences group, has been reaching out to users, developers and owners of life sciences spaces, asking why they aren't coming to Houston, Rushing said. They typically respond by asking why they should be.
“So we walk them through … why Houston makes sense from a life sciences perspective," Rushing said. "And almost across the board, every single one of them says ‘OK, I’m sold. That makes sense. I’ve never had someone tell it to me like that.'”
The study found Houston has plenty of selling points, including industry-leading expertise in cell and gene therapy, biologic drug development and molecular diagnostics; a continuous flow of new talent from regional universities; and an emerging commitment from community colleges to support two-year degree pathways to meet industry demands.
But like Rushing's prospects, too few know that.
“The Newmark study confirms what we knew to be true about the potential for life sciences growth in Houston,” GHP Chief Economic Development Officer Susan Davenport said of the report. “The study will help us coalesce our regional partners around a cohesive strategy to grow and expand the industry in Houston.”
Houston has a notable life sciences workforce, what Rushing called “brain power,” with research and drug development coming out of the Texas Medical Center.
CBRE recognized Houston as a “significant pocket of talent” in its 2022 Life Sciences Research Talent study, ranking it 13th out of 25 for life sciences research talent clusters and first for average annual salaries for select life sciences research occupations.
In 2019, CBRE only ranked 10 established life sciences markets but named Houston second among emerging life sciences hubs, behind Seattle.
Houston’s pricing structure also makes it competitive against top 10 markets in the life sciences industry since it has much cheaper cost of living and land prices than Boston, San Diego, the Bay Area and Seattle, Rushing said.
Some businesses already see the appeal.
Rushing and Zach Leger, senior associate for Partners, brokered a deal for Cellipont Bioservices, a cell therapy contract development and manufacturing organization, to build a 76K SF manufacturing facility for cell therapies and gene-modified cell therapies in The Woodlands. The company marked its groundbreaking Nov. 10.
Sino Biological, a Chinese provider of mammalian cell-based recombinant proteins, antibodies and related research, leased 10K SF of commercial lab and office space in Levit Green, Hines announced Monday. Levit Green is a 53-acre mixed-used life sciences district Hines is developing adjacent to the Texas Medical Center, and Sino Biological is its first tenant. It plans to open in Q3 2023.
But these developments haven’t been enough to break Houston into the top 10 markets for life sciences.
“I don’t think there’s anything holding us back right now, other than education,” Rushing said. “We’ve been a little behind the curve in trying to promote ourselves.”
It will take people being interested in selling the whole region as a life sciences market, not just specific projects, Leger said.
“I think there is a strong need for a more unified message,” he said.
That is one of the things the GHP-Newmark study — which was sponsored by San Jacinto College, Lone Star College, Houston Community College and McCord Development — recommended to help boost Houston’s position in the rankings.
Along with developing a shared regional strategy to attract and retain leading life sciences companies, the study recommends accelerating workforce development programs to produce new graduates in key life sciences occupations and refining Houston’s marketing messages to highlight the existing life sciences assets and activities within life sciences research, development and manufacturing.
Leger said he expects some exciting news about relevant workforce and manufacturing development to be announced soon, adding he is in contact with multiple manufacturing groups regarding their interest in Houston.
But it is unclear whether a life sciences boom will happen anytime soon, or at all, despite better marketing and efforts to grow the local talent pipeline.
“Do I think there will be [a boom]?” Rushing said. “I hope so. And I think there should be.”
Choosing Houston may require a gamble. It is one real estate developers hope life sciences industry players will take, given the 640K SF of life sciences space being constructed, with another 1M SF under consideration, per JLL.
“Going out and building life sciences facilities on spec is a costly venture,” Rushing said. “Doing that without shoring up what the demand is … it’s risky for developers to come in and plant their flag and start putting up facilities on the promise of ‘if you build it, they will come.’ But it makes all the sense in the world.”
