GIC Buys 40% Stake In Oxford Science Park For £160m
UNITED KINGDOM – Sources revealed that Singapore’s sovereign wealth fund GIC has purchased a 40 percent stake in Oxford Science Park for £160 million from Oxford university’s Magdalen College, reported the Financial Times on Tuesday morning (5 October, SGT).
In May 2021, Magdalen College announced that it is seeking a partner to acquire a share of Oxford Science Park and help develop the remainder of the property. In the latest deal, it was advised by Bryan Cave Leighton Paisner and Cushman & Wakefield.
The transaction implies that the entire science park is valued over £400 million, and Magdalen College divested the stake for more than 10 times its worth in 2016. Back then, the seller acquired the remaining 50 percent stake it didn’t already own in the property from its former partner M&G Real Estate for £18.1 million, implying a total valuation of £36.2 million.
The high price of the 40 percent stake in Oxford Science Park comes amidst a upswell of investor interest in specialised property catering to the life sciences sector. Investors are keen to enter this commercial property segment as they think it will generate strong rental growth and capital values, compared to other segments that have been hard hit by the COVID-19 pandemic, particularly retail.
Notably, a particular target is life science properties within the “golden triangle” between Cambridge, Oxford, and London, which houses start-ups, established life science businesses, and universities known for their R&D work.
In fact, a new study by life sciences group MedCity shows that demand for office and laboratory space catering to the life sciences sector in London has surged by 4-fold since 2016.
“The scientific innovation, impact and reputation” of London and south-east England would allow the region to benefit from the boom in investment caused by the pandemic,” said MedCity’s CEO Neelam Patel in an interview with the Financial Times.
“The capabilities and the expertise around data and artificial intelligence, along with novel innovations like gene therapy, and the talent that is coming out of institutions in the region, is what’s continuing to make it stand out globally,” she explained.
Moreover, the value of real estate needed by the life sciences sector has significantly increased as life sciences firms recorded huge valuations and amassed hefty funding.
In the past week, 2 businesses operating at the Oxford Science Park have launched initial public offerings (IPO). Gene sequencing FIRM Oxford Nanopore LISTED on the London Stock Exchange last Thursday, during which its shares jumped over 40 percent, pushing its valuation to nearly £5 billion.
Last Friday, Exscientia, which taps artificial intelligence to create antiviral drugs, floated on Nasdaq valuing it at almost U$3 billion.
“Companies based on the park have now raised more than US$2 billion since the start of 2020. Nanopore and Exscientia are not the only ones growing very fast. Our biggest challenge is providing enough space to accommodate them all, that’s why we’ve done this deal,” added Rory Maw, CEO of Oxford Science Park.