Venture capital (VC) investment is essential for developing young businesses and encouraging new occupiers into the area. Oxford has received more than £1.7 billion of VC investment since 2015, exceeding that received by Cambridge and Reading combined.
Some 53% of Oxford VC funding has been invested in electric-car company NIO to develop next-generation electric cars. With Oxford’s positioning in the centre of an exceptionally strong high-value automotive sector, this is a positive prospect for the Oxford commercial property markets to prosper further.
As well as automotive, the wide range of sectors in Oxford is illustrated by companies such as Oxford Nanopore Technologies receiving £170 million to develop scientific research and support Oxford’s growing science and tech sector. We expect these fast-growing sectors to be acquiring additional office space to facilitate expansion.
A reinforcement to the growing VC scene, Oxford Sciences Innovation (OSI), established in 2015, has become one of the largest university venture funds. It has raised £580 million and invested in 30 companies, most of which are in the life sciences field. This is relatively new for Oxford and will drive demand for commercial property in the future.
This is positive for Oxford but, as shown in the chart, there is a need to ensure that companies attracting VC (and private equity investment) go on to grow and create larger organisations. The mergers and acquisitions levels are for those larger companies and such companies, in any global market, will have strengthened the ecosystem. Cambridge is stronger at this stage compared with Oxford, but it’s only a matter of time before Oxford sees corporates grow in the same direction and have a direct positive impact on the level of demand for office space and the corresponding job growth. Delivery of office space for companies to move into and grow is vital.
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