Life sciences is a booming industry and commercial real estate experts only expect for this market to continue flourishing in 2022. According to CBRE’s U.S. Life Sciences Trends 2021 report, we have reached all-time highs in funding, job growth and demand for lab space and new construction. As the demand for life sciences space continues increasing in cities, so will the demand for housing that accommodates graduate students and professionals working in this industry.
Up to this point, most commercial real estate developers have not considered how this increase in life sciences activity will affect the multifamily or student housing industries. As we’ve monitored this growing market, we found that graduate students and professionals in the life sciences, medical, educational and tech communities have very different needs compared to renters with a more traditional school or work schedule. Residents in life sciences tend to have unconventional work hours and are interested in living at a property with amenities and services that complement their schedules and lifestyles.
To meet this demand, GMH Communities launched a new vertical within our portfolio called Innovative Living, a first-of-its-kind fusion of student and conventional housing that fosters a vibrant environment of unique living solutions that cater to the needs of the knowledge community. Currently, GMH is completing the final construction phase of its first Innovative Living project, ANOVA uCity Square in uCity Square, a growing innovation hub in University City, Philadelphia.
When planning ANOVA, our first consideration was location. According to Newmark’s 2021 Year-End Life Science Overview & Market Clusters report, Philadelphia ranks fifth among the top life science real estate markets in the country, and a large portion of this life science growth is happening in University City, home to nationally recognized medical and life science institutions such as the University of Pennsylvania and Drexel University.
As a result, there are already ample life science students and professionals living and working in this area, and countless more who are expected to flood uCity Square as the hospitals and universities continue to expand. Apartment developers should keep a close eye on rapidly growing markets like Philadelphia to identify lucrative opportunities for multifamily and student housing growth where there are high concentrations of life science students and professionals.
The second, and arguably most important factor, is the amenities you offer to attract and retain this demographic. Graduate students and professionals working the third shift are seeking amenities and features that simplify, connect and streamline their daily tasks. Consider smart features including high-speed secured wired and wireless internet in units and common areas; smart thermostats and lighting; keyless entry with a mobile video interactive intercom system; Luxe package systems; refrigerated delivery lockers; climate-controlled storage; and an EV-charging system.
In addition to implementing advanced tech, developers should also consider how they can enhance their current services to meet these residents’ day-to-day needs. Examples include 24/7 concierge, grocery delivery, dog walking, housekeeping, laundry/dry cleaning services, and more. Once residents return to their apartment from a long day of class or work, they enjoy the fact that they do not have to leave the property to check off some of their weekly tasks.
Which leads to the final consideration for developers: resident lifestyle. Many life sciences residents have busy schedules, but they care deeply about health and wellness. Therefore, it’s important to offer on-site amenities that promote self-care and relaxation for residents. Aim to provide this experience through communal amenities such as a fitness center with a yoga and spin studio; a pool and courtyard with a hot tub; indoor and outdoor lounges; a cyber cafe with a complimentary coffee bar and beer taps; a golf simulator; resident events and programming during off-hours and more. To help promote collaboration and productivity, co-working spaces, private huddle and conference rooms, and soundproof office pods add tremendous value. Finding that live-work blend can be difficult for graduate students and the third-shift worker. As a result, apartment developers are now being tasked with providing a living environment that promotes overall wellness for their residents.
As the life sciences sector continues to grow throughout the United States, the commercial real estate industry must evolve to meet this demographic’s demands. Overall, student housing and multifamily innovators who can enhance their amenities and services to cater to these residents will see great success in 2022 and beyond.
— Gary Holloway Jr., president and CEO of GMH Communities.