The Covid pandemic exposed critical weaknesses in Australia’s medical supply chains, highlighting the risks of global dependencies. In response, the Government has accelerated investment in the life sciences sector, which has grown by 43 per cent since 2019, reinforcing the push for domestic resilience.
At the same time, workplace dynamics have undergone a seismic shift. Remote work has become the norm, leading to historically low office occupancy rates in major cities—averaging just 60 per cent in Melbourne and Sydney CBDs in 2023-24. In contrast, industrial real estate—the preferred route for life sciences development—is facing record-low availability, with vacancy rates as low as 0.6 per cent.
These converging trends—the booming life sciences industry, changing workplace preferences, and real estate imbalances—have opened a unique opportunity: repurposing vacant office buildings into high-performance laboratory spaces.
As the sector expands, competition for top talent has intensified, making location a decisive factor. Companies increasingly prioritise proximity to biomedical hubs, research institutions, and public transport over traditional industrial estates. This shift has fueled demand for life sciences clusters like Ferntree Business Park in Notting Hill, Victoria, where organisations seek strategic positioning to enhance their employee value proposition.
Governments are backing this transition, emphasising sustainable urban development through building retrofitting. As Melbourne’s Lord Mayor, Nick Reece, said: “Retrofitting existing buildings is crucial for sustainable development and economic growth.”
While the opportunity is clear, converting office spaces into laboratories presents significant hurdles:
Infrastructure Limitations—Standard office buildings lack the mechanical, electrical, and plumbing (MEP) systems required for labs. Retrofitting must accommodate specialised needs such as increased air changes per hour, temperature and humidity controls and structural reinforcements to support heavy lab equipment.
Operational Efficiency and Compliance—Labs require careful planning to ensure seamless movement of materials, personnel and waste while maintaining regulatory compliance. Poorly designed conversions can lead to costly disruptions and inefficiencies.
High Fitout Costs—Converting an office into a lab is significantly more expensive than a typical office refurbishment. Many startups lack the capital to fund these projects independently. Colliers director of leasing Ash Dean has said, “Many life science startups can’t afford their own fitout. They need landlords with the financial capability to assist via incentives.”
Despite these challenges, several Australian projects showcase the viability of adaptive reuse:
Parkville Biomedical Precinct, Melbourne—Transformed a commercial office into a state-of-the-art research facility.
Macquarie Park Innovation District, Sydney—Successfully converted underutilised office spaces into a thriving biotech hub.
For those considering office-to-lab conversions, strategic planning and expert collaboration are essential:
Early Contractor Involvement (ECI) Model—Bringing in contractors early helps assess feasibility, identify challenges, and maintain cost control. “Using our ECI model allowed us to quickly determine our client’s property’s suitability and conversion approach; from office to lab,” head of delivery Cameron Easdale says.
Technical Assessments and Compliance Planning—Engaging specialists in lab design ensures the building meets regulatory and operational requirements from the outset.
Efficient Space Planning—Thoughtful layout design maximises operational efficiency while addressing safety and compliance needs, including waste disposal and hazardous material handling.
Cost Control and Market Intelligence—Partnering with experts in life sciences facility design and leveraging real-time market data can help mitigate cost overruns and improve decision-making.
Australia’s life sciences sector is projected to generate more than 80,000 new jobs in the next decade, increasing the demand for specialised spaces. Adaptive reuse will be a key driver in meeting this demand, ensuring Australia remains at the forefront of medical research and innovation.
Connected Workplaces general manager Emma Bedford said, “Adaptive reuse isn’t just a trend—it’s a necessity for sustainable urban development”.
With strategic planning and the right expertise, developers can unlock the potential of existing office buildings to create the life sciences hubs of the future.
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