Canary Wharf Landlord To Build Giant Biolab In Former Financial Hub

Courtesy of ZeroHedge View original post here.

This seems like a strange place for a giant biolab.

As East London's famed Canary Wharf financial district struggles to rebound from the COVID pandemic that inspired the 'work-from-home revolution' (leaving many of the district's skyscrapers disappointingly vacant) the local landlord, Canary Wharf Group, has devised a 'novel' solution.

And that plan is: develop a 22-storey, 750,000 square foot block split between 'wet labs' and office space. The landlord hopes this new setup will ultimately provide the anchor for a thriving life-sciences cluster in East London (where the entire local economy has started to collapse due to a shortage of office workers to patronize local shops and other business). The project is expected to cost roughly $660 million.

Here's more from the FT:

The company is partnering with Kadans Science Partner, a specialist Dutch developer, on the project, which is expected to cost at least £500mn to build according to people with knowledge of the matter.

The project, due to complete in 2026, is a key part of CWG chief executive Shobi Khan’s vision to transform the area and attract a wider array of tenants. The Wharf had changed from “what the old guard knew it as”, said Khan.

The financial district envisaged 30 years ago as a rival to the City of London was giving way to a mixed use neighbourhood with more leisure activities and homes, he added.

Even before the pandemic, as more banking jobs moved to the Continent and elsewhere in the wake of Brexit, it's pretty clear that the financial services industry isn't coming to the rescue.

"We’re down to 50 per cent financial services [tenants] and we’re broadening out to health and life sciences now. This is a city within a city," he said.

But while the pandemic has undermined demand for commercial office space (just ask Blackstone), it has inspired a revolution in the life sciences.

About 120,000 people regularly worked at Canary Wharf before the pandemic, which stemmed the flow of workers to the area and starved local businesses of income. Khan said the number of people currently commuting in was at a pandemic high, but he would not give a figure. A number of landlords and institutions are investing in life sciences, confident that a focus on healthcare and scientific research – intensified by the pandemic – will keep demand for lab space rising.

Canary Wharf will still need to compete against other 'life sciences hubs' in London, as they're not the only ones who see opportunity in biolabs. Oxford, Cambridge and the area around King’s Cross in north London already have acres of lab space and are anchored by top universities and research facilities. Those areas, nicknamed the “golden triangle”, have attracted the bulk of recent investment into life sciences property in the UK.

In other Canary Wharf news, staff at Citi's Canary Wharf office are being forced to working from home after a major power failure across East London persisted into Wednesday, having knocked out computer networks and led to the activation of emergency electricity supplies, according to Bloomberg. HSBC, meanwhile, was forced to activate auxiliary generators at its headquarters in the district, per BBG.

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Canary Wharf Landlord To Build Giant Biolab In Former Financial Hub