Whether for pathology or pharmaceutical purposes, laboratory space in the UK is in shortage – an issue not just for individual businesses but for the UK’s growth agenda. However, laboratory equipment financing could change the picture.
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Life sciences is a key sector for the UK, according to the government’s Industrial Strategy, published in summer 2025.[i] The strategy lays out plans for the UK to be the leading life sciences nation in Europe by 2030, and to be ranked third globally, after the US and China, by 2035.[ii]
High-quality labs with cutting-edge equipment are vital to realise these ambitions. They could also help to reduce demands on the National Health Service (NHS). Since 2007, the number of histopathology requests to laboratories has increased by around 4.5% on average year on year.[iii] Private pathology labs can alleviate pressure by taking on some of this load.[iv]
Yet a lack of commercial lab space for life sciences could stand in the way. With demand
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outstripping supply, and lab rents in the Oxford-Cambridge super-cluster almost at San Francisco level in late 2024,[v] the costs of setting up or expanding existing lab space may be out of reach for some companies. The fact that the UK is not alone, with a well-documented shortfall across Europe,[vi] may be of little consolation to businesses.
The positive news is that the Industrial Strategy includes a package of support and reforms for the sector. And there is more lab space in the pipeline. According to Cushman & Wakefield, over 450,000 square feet of lab space was completed across the Golden Triangle of Oxford-Cambridge-London in Q2 2025; a further 3.8 million sq ft is due to be delivered before the end of 2028.[vii]
However, this additional lab space is three years away, and more space is needed fast. How can this be achieved in a way that allows life sciences businesses in the UK to invest and win new business now?
- Filling empty buildings
One option is to repurpose existing space. In the UK, it is now possible to convert offices into labs in the UK without planning permission, because they belong to the same ‘use class’.[viii] This opens up significant opportunities for estate and building owners with unused space and life sciences tenants, though other legal, planning or practical considerations may still apply.
In London, for instance, vacant offices in Blackfriars have been converted into one of the UK’s largest purpose-built pathology labs – consolidating 89 laboratories into one hub and freeing up NHS real estate for other purposes. [ix] There are other good examples of office-to-lab conversions in the pipeline, including a planned pilot project in Cambridge to turn an empty office block into a new innovation hub, with modular lab space installed in its former carpark.
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- Plug and play space
A second option for expanding lab space supply is the use of modular buildings – as used in the Cambridge carpark above. These ‘plug and play’ buildings are more affordable than building or converting labs from scratch and can be up and running more quickly. In addition, the space can be easily scaled or reconfigured, offering the agility to expand or pivot to different research or commercial activities.
- Labs for rent
A third option is to rent ready-to-use or walk-in labs. For start-ups and entrepreneurial companies, these smaller spaces can be a useful transitional stage to the options described above.
Expansion made affordable
At a time of global trade uncertainty and rising costs, businesses may struggle to raise capital or hesitate to tie it up in specialist labs and equipment – especially when technologies are advancing so quickly. There’s a solution, however. Developers and tenants across the life sciences sector can utilise smart lab financing models (including equipment) that make installations more affordable and cash-flow friendly.
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With these models, specialist providers offer smart financing arrangements that allow lab owners and managers to install and equip lab space without heavy upfront costs. Instead, they can spread the sum over a longer period, aligning repayments with cash flows, and retaining capital for liquidity or other purposes. It may be possible to lease up to 100% of the equipment.
Adapting infrastructure
Whichever option businesses pursue, there are specialist requirements to consider when designing lab space. Headroom, for instance, may need to accommodate tall structures such as fume cabinets. Heating, ventilation and air conditioning (HVAC) systems may have to be upgraded, especially if clean air, negative pressure, fixed temperatures or specific humidity levels will be required to ensure drug quality or patient safety. And there may be issues around compliance with the Control of Substances Hazardous to Health (COSHH) regulations if toxic materials will be used or stored.
In addition, landlords and life sciences businesses must pay close attention, from the earliest design stages, to buildings efficiency – as in any sector. This means meeting regulatory and stakeholder expectations for today’s offices and commercial buildings to be more sustainable, adaptable and energy-efficient, including through the use of smart digital technologies to monitor temperature, humidity and occupancy.
From the ground up
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Specialist finance providers such as Siemens Financial Services have an understanding of lab structures and equipment, and the technical requirements involved, including the process of converting building space into sustainable, energy-efficient working environments. This means that, as well as offering flexible finance support, they can guide customers throughout the whole project, tailoring lab equipment financing to the type of high-specification infrastructure and equipment they need.
For individual businesses, this offers the possibility to keep up to date with technology advances and get ahead of competitors, while also minimising the risk of doing so. For the wider sector, it could open some doors to reaching the government’s ambitions.
Learn more about laboratory equipment financing here. To share what’s going on in buildings transformation and the crucial role that flexible financing can play, Siemens has developed the Building Transformation Series, including a focused report for Pharma and Life Sciences. Subscribe to the series here to access the report.
By Sally-Anne Whybrow, Healthcare Business Development Manager, Siemens Financial Services UK
References
[i] https://www.gov.uk/government/news/life-sciences-sector-plan-to-grow-economy-and-transform-nhs
[ii]https://assets.publishing.service.gov.uk/media/687653fb55c4bd0544dcaeb1/Life_Sciences_Sector_Plan.pdf
[iii] https://www.rcpath.org/discover-pathology/public-affairs/the-pathology-workforce.html
[iv] See, for instance:
https://www.synnovis.co.uk/our-services;
https://www.rcpath.org/discover-pathology/public-affairs/the-pathology-workforce.html
[v] https://oxcamsupercluster.publicfirst.co.uk/Oxford%20-%20Cambridge%20Scenario%20Modelling-2.pdf
[vi] https://sifted.eu/articles/lab-space-europe
[vii] https://www.cushmanwakefield.com/en/united-kingdom/insights/uk-marketbeat/life-science-marketbeat
[viii] https://www.brydenwood.com/office-to-lab-conversion/s190962/
[ix] https://www.macegroup.com/projects/synnovis-blackfriars-hub/