Inside The £385M Deal That’s A Platform For British Land’s London Life Sciences Charge

For the past few years, British Land has slowly, carefully begun the process of tapping into the huge life sciences opportunity at its Regent’s Place office campus near King’s Cross.

But recently, that push has been supercharged. 

First, tech giant Meta agreed to surrender its lease at 1 Triton Square, a 312K SF building at Regent’s Place, giving BL an entire empty office block that it can now retrofit into labs and office space for life sciences firms. 

And Monday, BL announced that it has sold a 50% stake in 1 Triton Square to fund manager Royal London Asset Management in a deal that values the building at £385M. The deal allows BL to take capital that it would have spent on 1 Triton Square and reinvest it in other projects in London life sciences and beyond. 

“To be honest, we hadn’t thought much about converting 1 Triton, because it was let to a single occupier for 20 years,” BL Head of Workspace Leasing and Science & Technology Michael Wiseman told Bisnow in an interview on the day that news of the Royal London deal emerged. 

Wiseman outlined how BL’s London life sciences strategy has unfolded so far, what needs to happen to turn 1 Triton Square into a centre for science and how plans for other major assets at Regent’s Place like Euston Tower will unfold.

Triton Square was the venue earlier this month for Bisnow’s UK Life Science and Innovation Real Estate Annual Conference, held in partnership with British Land and attended by more than 550 people. 

Regent’s Place is a 13-acre, 1.5M SF office, retail and residential campus on Euston Road in the northern part of the West End of London, set about a mile from King’s Cross station. BL has owned the property and expanded there for about 40 years. 

During that time, occupiers have included a diverse mix of financial and professional services firms, most recently tech firms like Meta. But around a decade ago, the surrounding area became established as the heartland of life sciences in London due to the cluster of old and new organisations based there, including University College London, the Wellcome Trust and the Francis Crick Institute, all of which are major science research centres. 

BL knew it had to take advantage of the kind of life sciences cluster real estate owners dream of growing up around it, Wiseman said. The problem was how to do it, since most of its buildings were full on relatively lengthy leases. 

Around four years ago, it ran an analysis of all 10 office buildings at Regent’s Place to see how compatible they were for conversion to life sciences. Then, as individual floors or chunks of space were handed back, it undertook ad hoc conversions. 

It has put labs into 184 Drummond St., 20 Triton Square and 338 Euston Road, where one occupier is Relation Therapeutics, which has just completed a $35M (£27M) funding round backed by Nvidia, the artificial intelligence chip maker. Relation’s generative AI platform can be used to interpret human data about how cells and genes behave. 

But Meta’s decision to pay a premium to surrender its lease at 1 Triton Square to BL was a game changer, Wiseman said.

While not many owners in the current market want a 300K SF office building handed back to them, it allowed BL to create a focus point for the life sciences element of the campus. 

“When the opportunity came up and it became clear that Meta weren’t going to grow, we seized it,” he said. “It felt like a bit of a no-brainer for us, and it’s been reported that the economics made sense for both parties.”

Announcing the deal with Royal London, BL said that it will make an internal rate of return of more than 30% once 1 Triton Square is fitted out and leased up. That figure includes the combined effect of Meta paying it £149M to surrender its leases and the sale of a half share in the building for £192.5M. 

Typically, when retrofitting a building to cater for life sciences use, BL fully fits out some lab space since that is what smaller, high-growth occupiers require and leaves some “lab-enabled” to allow larger occupiers to do their own fit-out. Wiseman said the rents being paid in London mean BL expects to make a 20% premium to office rents on the lab-enabled space and double it or more on the fitted-out space. 

The firm usually expects life-sciences buildings to be around 60% lab space and 40% workspace, he said, although the ideal balance is changing all the time. 

In converting 1 Triton Square, the fact that the building was originally designed for a financial services occupier helps the repurposing process. Big floor plates intended for trading businesses that need a lot of power are ideal for life science occupiers, he said.

A lot of the process will centre around turning a building intended for one occupier into a multilet building, adding the ability to create multiple receptions around a large central atrium. The project should be completed in about 15 months.

As far as the future is concerned, BL last month announced a partnership with the Crick Institute, which will see 33K SF at 20 Triton Street converted into lab space which companies aligned with the Crick’s research goals can lease. 

“They are very focused on growing the ecosystem,” Wiseman said. “So it's about their role in helping London grow. This isn't a purely commercial play for them, this is about the role they can play and the responsibility they take in doing so.”

Earlier this year, BL also unveiled plans to transform the 36-storey Euston Tower into a building targeting science occupiers. The number of floors will be reduced, but the square footage will be increased from 320K SF to 500K. Once that scheme is completed, around 2029, more than half of Regent’s Place will be leased to science and technology occupiers. 

“If you look across 1 Triton, Brock Street and Euston Tower, you're over a million square foot across those three buildings alone,” Wiseman said.