Overview of the European Life Science Property Fund Launch in Luxembourg
A European life science property fund launched in Luxembourg is a closed-ended or semi-liquid vehicle that owns regulated scientific real estate across Europe. The core objective is to deliver stable income and capital growth from laboratories, GMP facilities, and R&D buildings, all held through a Luxembourg fund platform that institutional investors recognize and accept.
Institutional and private equity investors use a European life science property fund launched in Luxembourg to access high-specification assets in key research clusters with long leases and sticky tenants. The jurisdiction provides the legal structures, tax efficiency, and AIFMD framework needed to execute cross-border transactions at scale.
Market Drivers for a European Life Science Property Fund Launched in Luxembourg
Life science real estate is driven by regulated activity in biotechnology, pharmaceuticals, med-tech, and clinical research. These activities require certified laboratories, GMP production sites, and highly controlled environments that cannot be replicated easily in standard office stock.
Lease terms for life science tenants typically range from ten to twenty years because relocation requires re-validation of cleanrooms, recalibration of equipment, and new regulatory approvals. This lease profile underpins predictable cash flows for a European life science property fund launched in Luxembourg and supports long-term distribution planning.
Supply of compliant life science space remains constrained in leading clusters such as Paris-Saclay, Basel, Munich, the Oxford–Cambridge corridor, Copenhagen, Barcelona, Milan, Utrecht, Vienna, and Stockholm. Fit-out costs for advanced labs can exceed EUR 3,000 per square meter, which discourages speculative development and anchors rental growth.
Why Choose Luxembourg for a European Life Science Property Fund
Luxembourg provides a mature legal and regulatory framework for alternative investment funds under AIFMD. This framework allows sponsors to structure a European life science property fund launched in Luxembourg with clear governance, controlled leverage, and recognized investor protections.
Tax neutrality at fund level for non-Luxembourg real estate can be achieved when the structure is designed correctly. Asset-holding SPVs in property jurisdictions handle local tax and regulatory issues, while the Luxembourg fund consolidates control, risk management, and reporting to investors.
Luxembourg offers deep AIFM, depositary, administration, audit, and legal capacity, all experienced in cross-border real estate structures. This ecosystem reduces execution risk and provides the institutional backbone needed to market a European life science property fund launched in Luxembourg to professional investors.
Core Structures for a European Life Science Property Fund Launched in Luxembourg
Luxembourg fund law offers several structures that can host a European life science property fund launched in Luxembourg. The main options are the SCSp (Special Limited Partnership – Société en Commandite Spéciale), the RAIF (Reserved Alternative Investment Fund), and the SICAV-RAIF (Investment Company with Variable Capital under the RAIF regime) incorporated in SA (Société Anonyme) or SCA (Société en Commandite par Actions) form.
Each structure provides a different mix of contractual flexibility, corporate governance, time-to-market, and investor perception. SCSp is highly flexible and contractual; RAIF is fast and AIFM-supervised; SICAV-RAIF in SA or SCA form brings variable capital and a full corporate shell suitable for large multi-compartment platforms.
SCSp Structure for a European Life Science Property Fund Launched in Luxembourg
The SCSp is a special limited partnership without legal personality governed mainly by its Limited Partnership Agreement. This structure gives the sponsor strong control over governance, economics, fees, and carried interest arrangements for the European life science property fund launched in Luxembourg.
The SCSp is not directly supervised by the CSSF but can qualify as an AIF when an external authorized AIFM is appointed. This combination offers flexibility and AIFMD passporting, allowing marketing of the European life science property fund launched in Luxembourg to professional investors across the EU.
For non-Luxembourg real estate, the SCSp can be treated as tax transparent under the right conditions, enabling efficient use of local SPVs in property jurisdictions. Sponsors favor the SCSp when they pursue value-add or development life science strategies that require rapid execution and bespoke governance.
RAIF Structure for a European Life Science Property Fund Launched in Luxembourg
The RAIF regime requires an external authorized AIFM but does not require direct CSSF product approval. This structure enables fast setup of a European life science property fund launched in Luxembourg while preserving institutional oversight through the AIFM.
A RAIF can adopt different legal forms, including partnership and corporate vehicles, and can operate as a SICAV with variable capital. Multi-compartment RAIFs allow sponsors to separate core stabilized lab portfolios from development or value-add life science projects inside one umbrella fund.
Institutional investors accept the RAIF because risk management, valuation policies, and reporting fall under the AIFM’s responsibilities. For a European life science property fund launched in Luxembourg targeting large allocations, the RAIF offers a credible and efficient structure.
SICAV-RAIF in SA or SCA Form
A SICAV-RAIF is an investment company with variable capital under the RAIF law that can be incorporated as an SA or SCA. This choice affects governance and control but does not change the RAIF regime itself for a European life science property fund launched in Luxembourg.
An SA SICAV-RAIF offers a conventional corporate governance model with a board of directors or a two-tier system. Institutional investors recognize this format and often use it for multi-investor platforms in core life science clusters.
An SCA SICAV-RAIF gives a General Partner stronger management authority within a corporate shell. Sponsors use this when they want tighter control over execution of a European life science property fund launched in Luxembourg, especially for multi-phase lab and GMP developments.
UCITS as a Complement to a European Life Science Property Fund Launched in Luxembourg
UCITS funds invest in transferable securities and cannot hold direct real estate. They can, however, provide listed exposure to life science REITs or thematic indices linked to scientific real estate. UCITS products are sometimes used as a liquid complement to commitments in a European life science property fund launched in Luxembourg.
Key Features and Benefits of a European Life Science Property Fund Launched in Luxembourg
Key features of a European life science property fund launched in Luxembourg include regulated scientific assets, long leases, sticky tenants, and cross-border structuring. These features combine to create a defensive, income-focused strategy aligned with institutional demand.
Key benefits include long-term tenancy stability, low structural vacancy, inflation-linked rent reviews, and exposure to high-growth life science ecosystems. Investors use the fund to diversify away from traditional offices and retail while keeping a clear real estate risk profile.
- Long leases (often 10–20 years) with high tenant retention
- Technical scarcity of compliant laboratory and GMP space
- Strong covenants from pharma, biotech, and research tenants
- Alignment with government and EU research priorities
- Luxembourg AIFMD-compliant governance and reporting
- Efficient tax and SPV structuring for non-Luxembourg assets
How to Launch a European Life Science Property Fund in Luxembourg
The launch process for a European life science property fund in Luxembourg follows a clear legal and operational sequence. Sponsors move from strategy definition to structure selection, service provider appointments, documentation, and capital deployment.
- Define the life science investment strategy, asset types, clusters, risk profile, and target returns.
- Select the appropriate fund structure (SCSp, RAIF, or SICAV-RAIF in SA or SCA form).
- Appoint an external AIFM, depositary, administrator, auditor, and legal counsel in Luxembourg.
- Design SPV structures in target jurisdictions and confirm tax treatment for the fund and SPVs.
- Prepare and execute the Limited Partnership Agreement or corporate articles and the offering document.
- Complete AIFM onboarding, RAIF registration if relevant, and internal risk and valuation policies.
- Raise commitments from professional investors and finalize side letters where needed.
- Issue capital calls, close on seed or pipeline acquisitions, and implement asset management plans.
- Maintain ongoing reporting, AIFMD regulatory filings, and annual audited accounts.
- Execute exit strategies at asset, compartment, or fund level according to the agreed timeline.
Damalion supports project sponsors to setup their European life science property in Luxembourg. We also support you to have a depositary bank. Please contact your Damalion expert now.
Glossary: European Life Science Property Fund Launch in Luxembourg
This glossary summarizes key terms used in the context of a European life science property fund launched in Luxembourg.
European Life Science Property Fund
A European life science property fund is a vehicle that invests in laboratories, GMP facilities, R&D buildings, and related scientific real estate across European markets.
SCSp (Société en Commandite Spéciale)
SCSp is a special limited partnership under Luxembourg law used as a flexible, contractual structure for a European life science property fund launched in Luxembourg.
RAIF (Reserved Alternative Investment Fund)
RAIF is a Luxembourg AIF that must appoint an external authorized AIFM but is not directly supervised by the CSSF, allowing fast launch of a European life science property fund.
SICAV-RAIF
SICAV-RAIF is an investment company with variable capital under the RAIF regime, often used as a multi-compartment platform for a European life science property fund launched in Luxembourg.
SA (Société Anonyme)
SA is a Luxembourg public limited company used as the corporate form of a SICAV-RAIF with a classic board-driven governance model.
SCA (Société en Commandite par Actions)
SCA is a partnership limited by shares used as a corporate form for a SICAV-RAIF where a General Partner retains management control.
GMP (Good Manufacturing Practice)
GMP refers to regulated manufacturing standards for pharmaceuticals and related products that influence building design and fit-out.
Life Science Cluster
A life science cluster is a geographic concentration of universities, hospitals, research institutes, and science companies that drives demand for scientific real estate.
AIFM (Alternative Investment Fund Manager)
AIFM is the regulated manager responsible for risk management, valuation oversight, and AIFMD reporting for a European life science property fund launched in Luxembourg.
SPV (Special Purpose Vehicle)
SPV is a local holding company that owns property assets and manages leases and financing under local law on behalf of the Luxembourg fund.
European Life Science Property Fund Launch in Luxembourg – FAQs
What is a European Life Science Property Fund launched in Luxembourg?
A European Life Science Property Fund launched in Luxembourg is an investment vehicle that holds laboratories, GMP facilities, and R&D buildings throughout Europe using a Luxembourg fund structure.
Why choose Luxembourg for a European Life Science Property Fund?
Luxembourg is chosen for a European Life Science Property Fund because it offers AIFMD-compliant structures, tax-efficient cross-border ownership, and a strong network of institutional service providers.
Which structures are used for a European Life Science Property Fund launched in Luxembourg?
The main structures used for a European Life Science Property Fund launched in Luxembourg are SCSp, RAIF, and SICAV-RAIF in SA or SCA company form.
What type of assets does a European Life Science Property Fund target?
A European Life Science Property Fund targets laboratories, R&D facilities, GMP production buildings, clinical spaces, and innovation campuses in key European science clusters.
What is the typical lease term for life science assets?
The typical lease term for life science assets in a European Life Science Property Fund launched in Luxembourg ranges from ten to twenty years due to technical and regulatory constraints.
Who invests in a European Life Science Property Fund launched in Luxembourg?
Investors in a European Life Science Property Fund launched in Luxembourg include family offices, private equity firms, pension funds, insurers, and other professional investors.
What are the main benefits of life science property as an asset class?
The main benefits of life science property are long leases, sticky tenants, supply scarcity of compliant space, and strong alignment with structural growth in biotech and healthcare.
How does an AIFM support a European Life Science Property Fund?
An AIFM supports a European Life Science Property Fund by managing risk, overseeing valuation policies, monitoring leverage, and handling AIFMD reporting obligations.
Why are SPVs used in a European Life Science Property Fund launched in Luxembourg?
SPVs are used in a European Life Science Property Fund launched in Luxembourg to own properties in each country, manage leases locally, and optimize tax and financing structures.
Can a European Life Science Property Fund have multiple compartments?
Yes, a European Life Science Property Fund launched in Luxembourg can have multiple compartments, especially when structured as a RAIF or SICAV-RAIF.
What is the difference between SA and SCA for a SICAV-RAIF?
The difference between SA and SCA for a SICAV-RAIF is that SA offers classic board-driven governance, while SCA gives a General Partner stronger management control.
Does a European Life Science Property Fund launched in Luxembourg invest via UCITS?
A European Life Science Property Fund launched in Luxembourg generally does not invest via UCITS but may be complemented by UCITS funds offering listed sector exposure.
How long does it take to launch a RAIF for a European Life Science Property Fund?
Launching a RAIF for a European Life Science Property Fund can typically take between two and three weeks after documentation and service provider appointments are complete.
How important is ESG for a European Life Science Property Fund launched in Luxembourg?
ESG is important for a European Life Science Property Fund launched in Luxembourg because life science buildings consume significant resources and investors demand sustainability and regulatory compliance.
Which European markets are most relevant for life science assets?
The most relevant European markets for life science assets include the UK, Germany, Switzerland, France, the Nordics, Benelux, Spain, and Italy.
What role does technical due diligence play in acquisitions?
Technical due diligence is critical in a European Life Science Property Fund because laboratory systems, cleanrooms, and GMP features must be validated before acquisition.
How does a European Life Science Property Fund manage development risk?
A European Life Science Property Fund manages development risk through pre-let agreements, phased capex planning, fixed-price contracts, and strong technical supervision.
What exit options exist for a European Life Science Property Fund launched in Luxembourg?
Exit options for a European Life Science Property Fund launched in Luxembourg include asset sales, portfolio disposals, recapitalizations, and secondary transactions with institutional buyers.
Can retail investors access a European Life Science Property Fund launched in Luxembourg?
Retail investors generally cannot access a European Life Science Property Fund launched in Luxembourg because it is designed for professional and well-informed investors.
How does a European Life Science Property Fund support capital preservation?
A European Life Science Property Fund supports capital preservation through long leases, strong covenants, resilient demand for scientific space, and diversified exposure across clusters.
Luxembourg Banks
10 Major Life Science Properties in Europe
- Cambridge Biomedical Campus (Cambridge, United Kingdom)
- Biopôle Lausanne Life Sciences Campus (Lausanne, Switzerland)
- Life Science Campus Martinsried (Munich, Germany)
- Paris-Saclay University Life Sciences Cluster (Paris-Saclay, France)
- Stevenage Bioscience Catalyst Campus (Stevenage, United Kingdom)
- Edinburgh BioQuarter Life Sciences Campus (Edinburgh, United Kingdom)
- House of BioHealth Healthtech Campus (Esch-sur-Alzette, Luxembourg)
- Oeiras Life Science Campus (Oeiras, Portugal)
- Life Science Campus Mainz (Mainz, Germany)
- Lisbon/Oeiras Life Sciences Hub (COLife, Lisbon–Oeiras, Portugal)
10 Major Life Science Properties in the United States
- Texas Medical Center & Helix Park Life Science Campus (Houston, Texas)
- UCSF Mission Bay Life Sciences Campus (San Francisco, California)
- Alexandria Center for Life Science – New York City (New York, New York)
- Alexandria Center at Kendall Square Megacampus (Cambridge, Massachusetts)
- Research Triangle Park Life Science Campus (Research Triangle, North Carolina)
- Campus Point by Alexandria Life Science Megacampus (San Diego, California)
- Pacific Center Life Science Campus (Sorrento Mesa, San Diego, California)
- Kilroy Oyster Point Life Science Campus (South San Francisco, California)
- The Cove at Oyster Point Life Science Campus (South San Francisco, California)
- Science Center at Oyster Point Life Science Campus (South San Francisco, California)
