CLS Holdings
Maximilianforum, Martinsried
Four months ago, REFIRE examined the investment case for European life-science real estate: resilient valuations, sticky tenants, long leases and laboratory work that can't be done remotely. New German market evidence tests how readily those attractions convert into investable property. The answer is encouraging, but more selective than the sector's enthusiasts once hoped.
Germany recorded approximately €112m of life-science property transactions across eight assets in H1 2026, already close to the total for the whole of 2025 — a recovery from near-standstill, not a return to 2023's €409m peak. A new study by Colliers and specialist science-park owner ESPG describes the market as entering "a new, more selective phase." The transaction figures bear that out.
Core assets dominate a very small market
Core-plus strategies and project developments once accounted for over 80% of German life-science volume. In 2026, high-quality core properties in established clusters generated around 83% — though with only eight first-half transactions, a deal or two can shift that composition sharply. The direction is nonetheless clear: completed, well-located assets are attracting capital more readily than projects carrying development risk.
That preference concentrates activity in a handful of micro-clusters. The Colliers/ESPG study ranks Munich-Martinsried, Heidelberg's Neuenheimer Feld, Berlin-Adlershof and Mainz on research strength, capital access, start-up density, governance and potential — with Martinsried scoring highest on all five.
CLS Holdings' repositioning of the 13,900 sqm Maximilianforum in Martinsried illustrates the logic: shared co-laboratory space and BSL-1/BSL-2 labs for smaller life-science tenants. "With the Maximilianforum, we are specifically tapping into a future market that goes far beyond the traditional demand for office space," says Rolf Mensing, head of Germany at CLS. "Martinsried is one of Europe's leading life sciences hubs." The site sits 700 metres from the Innovation and Start-up Centre for Biotechnology, with Bavaria planning up to €500m in wider campus investment and a U6 underground extension due by end-2027. "We do not simply redevelop vacant spaces, but consistently tailor them to the needs of future users," adds Einar Osterhage, head of German asset management at CLS. The strategy is to adapt an existing property within an ecosystem already backed by science, infrastructure and public money.
Finding a buyable asset is harder still. Austrian manager Galcap spent two years searching German innovation clusters before acquiring three buildings at Heidelberg's Neuenheimer Feld, secured off-market for a German pension fund after approaching longstanding owner Sparkasse Heidelberg directly.
The deal qualifies the sector's reputation for sticky, long-lease occupiers. Two-thirds of the 13,800 sqm complex is laboratory space with reportedly high demand, yet the average lease runs under three years, reflecting a tenant base of young, growing companies. Galcap hopes to lengthen leases over time; for now, tenants are embedded in the cluster even as contractual income stays short. Managing partner Marco Kohla argues life-science assets need a yield premium partly because transaction volumes are so limited — strong demand, scarce opportunities and short leases together explain why the sector looks compelling operationally without yet being a liquid institutional market.
Development requires more than laboratory demand
Berlin's Riverside Labs shows what building new supply actually takes. IQ Spaces' planned ten-storey biotech centre at Nordhafen — 20,000 sqm, €200m — will host Bayer and Charité cell and gene-therapy research, a Bayer incubator and space for 15–20 start-ups, with 80% already allocated. Planning approval took just five months. But the project also depends on roughly €100m of federal and state funding, which project reporting describes as essential to making the development possible in its present form — evidence that Germany's flagship developments are assembled from public policy, institutional research, corporate occupancy and private capital together, not laboratory demand alone.
Nor is conversion an easy fix for surplus offices. ESPG chief executive Ralf Nöcker calls it "quite clearly a specialist niche" where proximity to the right research institution matters more than conventional prime/secondary distinctions. Ventilation, power, floor loading, goods movement and separating people from biological or chemical materials all become constraints; multi-storey offices often need separate lifts, and shallow office floorplates clash with the deep rectangular spaces labs require.
Costs vary widely — Nöcker cites one conversion completed at €250/sqm, questions whether €1,200/sqm remains viable and says ESPG has rejected opportunities at €1,600/sqm. Structural improvements need roughly a ten-year lease to refinance, while technical components can be obsolete within three to five years, making speculative conversion before securing a tenant genuinely risky.
AI will reshape these requirements without making labs redundant — more early-stage research is simulated digitally before physical validation, integrating wet labs, offices and computing more closely, which broadens possible building formats but adds another layer of technical judgement.
REFIRE: Germany's life-science market is recovering, but not expanding indiscriminately. Capital is concentrating on completed assets in proven micro-clusters, buyable opportunities remain scarce, and ambitious developments still depend on unusually strong combinations of occupiers, public support and specialist expertise. The demand is real; turning it into institutional property remains the hard part. Germany isn't yet producing a broad, liquid asset class — it's proving, one carefully assembled building at a time, where life-science real estate actually works.