AI is Having An Immediate And Massive Impact On Big PharmaMedical Research Is Being Turned On Its Head And Property Strategies Will Have To Change
I came across an insightful article by Paul Armstrong in City AM (25-02-25) on AI’s radical impact on the pharma industry - especially its evolving property needs.
Paul Armstrong, founder of TBD Group and author of Disruptive Technologies, dives into these shifts.
I’ve summarised it to around a third of its original size and put on my own spin as well as adding my own commentary on AI’s key effects on Big Pharma’s property demands, but to read the full article, access City AM’s excellent web site at https://www.cityam.com.
AI recently cracked a superbug problem in 48 hours - something that used to take scientists a decade. That’s not just a cool science story; it’s a sign of what’s coming. AI isn’t just making breakthroughs faster - it’s doing it at a such a pace that businesses, governments, and entire industries can’t keep up.
The Old Rules? Forget Them.
Traditionally, medical research followed a slow methodical process. AI just shredded that playbook. Hypotheses, experiments, refinements? AI is handling those in hours, not years. The first industries to feel the impact? Healthcare, pharma, and drug development. But the ripple effect will hit everyone.
Think about how Ozempic, a single weight-loss drug, has already shaken up healthcare, food industries, and even the stock market. Now imagine AI accelerating all breakthroughs that quickly. Insurance models? Workforce health projections? Retirement planning? They’re all about to be turned upside down.
What This Means for Business
If AI extends human life or predicts diseases before they start, the whole idea of career spans and retirement shifts. Companies will need to rethink pensions, workforce planning, and even employee benefits. If retirement ages push back by a decade, that changes everything from talent retention to healthcare policies.
And insurance? A complete shake-up. Traditional risk calculations rely on historical data, but AI is rewriting human health in real time. Insurers that don’t adapt will be stuck with outdated models, leading to pricing disasters and financial losses.
Supply Chains and Investing? Also on the Chopping Block
A world where pandemics are solved in days instead of years will force global trade and production to move at breakneck speeds. Pharma companies, vaccine logistics, and raw material suppliers will have to shift from slow, resilience-based planning to rapid response strategies.
For investors, AI-driven breakthroughs mean traditional R&D cycles no longer dictate a company’s value. A biotech firm with a “five-year roadmap” might get blindsided when AI slashes that timeline to months. Investors who don’t build real-time AI foresight into their strategies risk backing companies that are obsolete before they even launch.
What Should Businesses Do?
Leaders need to ditch five-year plans and shift to real-time adaptability. The old strategy of waiting for regulatory clarity? That’s a recipe for being left behind. AI isn’t slowing down, and neither are the industries embracing it. Quarterly or even six-month reviews of AI-driven discoveries will be crucial. Many advancements won’t be public knowledge right away, but staying informed - and forming the right partnerships - will be the difference between leading an industry or being acquired by one that does.
SUMMARY OF AI’s IMPACT ON PROPERTY NEEDS
Impacts on corporate real estate involve reducing physical footprints while driving demand for high-tech, flexible workspaces.
Key Impacts:
• Smaller Manufacturing Facilities: AI-driven optimisation in drug development cuts production volumes, requiring less space.
• Rise of Data Centres: The surge in AI-generated data demands robust storage and processing infrastructure.
• Specialised Labs: AI-driven precision in drug discovery increases the need for niche research spaces.
• Flexible Workspaces: A growing AI workforce calls for collaborative, innovation-friendly environments.
• Remote Work Expansion: AI enables off-site research and analysis, reducing traditional office needs.
• Automated Labs: AI-powered automation streamlines lab setups, minimising space requirements.
• AI is redefining operations: Such as how and where companies operate, balancing efficiency with the need for cutting-edge work environments.
• Remote work capabilities: AI could enable more remote work opportunities for researchers and analysts, potentially reducing the need for large on-site office space.
• Advanced automation in labs: Automation powered by AI can minimise the need for extensive manual laboratory space, allowing for more compact lab setups.
The Bottom Line
AI isn’t about who uses it - it’s about who’s ready for what it discovers next. The businesses that prepare now will be the ones shaping the future.
The ones waiting for the memo? They’ll be playing catch-up indefinitely
Transforming Workspaces: A Successful HQ Relocation for Gilbarco Veeder-Root
We are thrilled to spotlight a recent project showcasing our expertise in workspace transformation! Gilbarco Veeder-Root, a globally renowned leader in fuel pumps, dispensers, hydrogen refuelling, EV charging and retail payment solutions, entrusted us with the relocation and refurbishment of their UK Headquarters.
After 40 years in their previous premises, Gilbarco made the strategic decision to move to a new facility in Basildon. Our team conducted a thorough analysis of the warehouse and office space, developing a bespoke design and layout that aligned with Gilbarco’s operational needs and future ambitions.
Over the course of a 16 week 26,000 sq ft fit out, our skilled professionals meticulously stripped the space back to its shell and executed a full-scale refurbishment. A major highlight of the project was the installation of a brand-new mezzanine in the warehouse, to expand the office element and optimise space efficiency and functionality.
The result? A sleek, modern, and highly functional workspace that not only enhances productivity but also reflects Gilbarco’s innovation and industry leadership. We are incredibly proud of this collaboration and look forward to supporting Gilbarco Veeder-Root with ongoing office maintenance and future projects.
Interesting facts about Gilbarco Veeder-Root
Gilbarco’s story goes way back to 1870, when Charles Gilbert and John Barker teamed up in Springfield, Massachusetts to form Gilbert & Barker. Fast forward to 1911, and they were already making waves in the fuel industry by introducing the first-ever measuring gasoline pump—a game changer at the time.
In 1929, the company took on the sleeker, more modern name Gilbarco, and by the 1960s, it had become Springfield’s biggest employer.
For nearly a century, Gilbarco was closely tied to what we now know as ExxonMobil, until 1987 when the British company GEC swooped in and acquired it. Interestingly, one of Gilbarco’s early products wasn’t a gas pump but a simple oil-burning lamp. These lamps were given away in China and other regions to boost lamp oil sales, and they became so iconic that they inspired the name of Exxon’s in-house magazine, The Lamp - a publication that lasted for decades before being discontinued.
The late 1990s brought another shift. In 1999, GEC rebranded itself as Marconi, and in 2002, Gilbarco found a new home under Danaher Corporation, the parent company of Veeder-Root.
That’s when it officially became Gilbarco Veeder-Root, the name it carries today.
From humble beginnings with oil lamps to pioneering fuel technology, Gilbarco’s journey has been nothing short of remarkable!
London’s Office Market: Sky High Rents – but there’s a catch.
It all begins with an idea.
I spotted a great piece in the FT last Saturday by Joshua Oliver on the battle for London’s priciest office space. Here’s the short and snappy precis I’ve concocted for anyone who’s curious!
See www.ft.com for the full article. There is a pay wall but it is well worth a read.
London’s Office Market: Sky-High Rents and Fierce Competition – but there’s a catch.
Rents top £100 per sq ft at apex of market, but lower tiers continue to struggle
Forget Wall Street giants—Brazil’s Banco Master holds the record for London’s priciest office rent, shelling out £122 per sq ft for a top-floor spot at 22 Bishopsgate. That’s no fluke. Rents above £100 per sq ft were once rare, but in 2024, 17 leases crossed that threshold - more than in all previous years combined.
So, what’s driving these sky-high costs? A supply squeeze, premium perks, and the ongoing battle to lure employees back from the Work-From-Home ethic.
The New Arms Race: Ultra-Premium Amenities Galore
Landlords aren’t just offering desks; they’re selling an experience. At 22 Bishopsgate, tenants like Apple and law firm Skadden Arps enjoy a 400-seat event space, co-working hubs, and the UK’s highest gym - complete with a climbing wall. Need a bike tune-up? It’s free on Tuesdays. Fancy a bite? Gordon Ramsay’s got you covered with restaurants and a cookery school spanning the 55th to 61st floors.
Over at 40 Leadenhall, nicknamed "Gotham City," Kirkland & Ellis is moving into a tower packed with 17 terraces, a cinema, and three saunas. Even mid-rise buildings are in the game - Helical’ s building near Smithfield fetches £115 per sq ft, thanks to luxury changing rooms and Equinox gym style vibes.
Supply Crunch = Landlord Leverage
With few new towers on the horizon, landlords are in the driver’s seat. Construction slowed post-Covid, and only three major office buildings are set to be ready by 2027-2028. “
There’s a black hole of availability,” warns Knight Frank’s Katie Oliphant.
But it’s not all smooth sailing. London’s office vacancy rate hit a 20-year high of 10.5% in 2024, and as the economy wobbles, cost-conscious tenants may push back.
Case in point: Banco Master is reconsidering its pricey lease at 22 Bishopsgate.
Winners and Losers
Prime locations with top-tier perks will continue to command jaw-dropping rents. But older, outdated offices? Some may never be leased again. “That stock is obsolete,” says Savills’ James Evans. Expect conversions into something else—perhaps apartments, hotels, or even creative spaces.
For now, the battle for the best office spaces rages on, and in London’s skyline, it’s survival of the fittest (and flashiest).