The headline property story of the summer so far is that, four months on from announcing it re-locating to Cambridge, AstraZeneca has chosen the Cambridge Biomedical Campus at the Addenbrooke’s site as the new location for its corporate HQ and new UK-based global R&D facility.
The fact that a ‘Cambridge site’ has been selected as the location for the new £330 million operation is not necessarily as newsworthy as the fact that biopharmaceutical giant could find a site in Cambridge to accommodate its expansive requirements.
Obviously the identification of Cambridge and a suitable site were made in tandem but there were only two sites in the running: Granta Park and the Biomedical Campus. The smart money was always on the latter, simply because of the scope of the site and the compatibility of complementary academic institutions and R&D programmes on-site already.
Selecting ‘Cambridge’ as the location for a corporate HQ or R&D operation – or both - is the easy bit. Indeed, selecting a site is easy because the choice is becoming increasingly limited.
It’s finding a site that can meet the high quality requirements and the kind of expectations that blue-chip corporates have of Cambridge that can prove problematic.
The imperative to pre-let in Cambridge to secure the right site has never been so urgent – AstraZeneca’s new HQ won’t be built until 2016.
Property is something that corporate behemoths like AstraZeneca will have been advised of a long time before contemplating a move to anywhere and that’s not just Cambridge and it’s also not simply because of the bespoke requirements of its niche sector.
It’s surprising how low a priority property availability is on the business agenda of companies who, while they may not be in the same league as the corporate giants, nevertheless are big enough and savvy enough in all their other business dealings to know better.
Indigenous, home-grown ‘Cambridge’ companies are often the most complacent in considering property availability when masterminding business growth and expansion plans.
Perhaps this is a legacy from the turn of the century when the early stage founders of companies of that time did have a pick of property-opportunities on the science parks and business parks.
Not so in the second decade of this century.
For more than three years, agents in the city have red-flagged the paucity of Grade A stock availability in the Cambridge area would mean that occupiers with mid-decade growth would need to look to a pre-let or face rising rents to secure premium business space.
The pre-let route, where planning permission is in-situ and finance in place still demands early action as it can take anything from 15-24 months from negotiations to practical completion to deliver a bespoke building.
But sites are running out and the development pipeline in the Cambridge is drying up. At the end of last quarter (Q1 2013), schemes with planning consent totalled just 3.8 million sq ft.
Sound like a lot? It’s not. Not when you consider AstraZeneca will occupy circa 11 acres of the 70-acre Biomedical Campus.
The reflected business glory of Cambridge in which we are all happy to bathe, means that more corporates will have Cambridge’s remaining sites in their sights.
Will Mooney MRICS
Partner
Commercial, Cambridge
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