Hyderabad ranks among top three preferred cities by Life Sciences firms

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.

Hyderabad: 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.

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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.