How do you grow a CRO when you’re out of room to grow? As demand for outsourced research accelerates, CROs are under pressure to scale faster than ever. But adding new lab space isn’t always feasible—or necessary.
This post dives into some ways in which contract research organizations can expand their capacity, increase throughput, and stay competitive without signing a new lease, or something else totally crazy and nuts like that.
The CRO Bottleneck: More Demand, Less Room
Contract research organizations (CROs) have become a critical force in the life sciences ecosystem.
As pharma companies streamline in-house R&D and biotech startups focus on lean operations, demand for outsourced research—from preclinical to clinical trial support—has surged. The global CRO market is growing fast, fueled by advancements in oncology, biologics, gene therapy, and personalized medicine. According to market forecasts, it’s expected to reach well over $100 billion in the next few years, with strong CAGR projections across both established and emerging regions.
But with all that growth comes a constraint: lab space.
In biotech-heavy regions like Boston, San Diego, and the Bay Area, commercial lab real estate is limited and expensive. Even where land is available, buildouts take time—often 12 to 24 months depending on permitting, utility requirements, and regulatory approvals. That’s far too long for CROs trying to capitalize on new client relationships or scale up service offerings quickly.
Meanwhile, existing labs are hitting their limits. Fume hoods are full. Core equipment is booked around the clock. And the headcount needed to run additional studies or support new therapeutic areas often outpaces the physical footprint of current facilities.
The result? CROs are seeing strong top-of-funnel demand—but without smart expansion strategies, they risk bottlenecking in execution. And in a space defined by speed, reliability, and scientific rigor, those bottlenecks don’t just slow down growth—they can cost future partnerships.
Why Real Estate May Not Be the Answer
For CROs facing growing client demand, expanding physical lab space might seem like the logical next step. And in some cases, it is. New square footage can enable larger studies, accommodate new modalities, and support future headcount growth.
But real estate isn’t always the fastest—or most strategic—way to scale.
In biotech-heavy regions like Cambridge, South San Francisco, or San Diego, lab space is expensive and competitive. Even when suitable properties are available, buildouts can take 12 to 24 months, factoring in permitting, zoning, and the specialized infrastructure needed for GMP or high-containment workflows.
It’s also a significant capital investment. Depending on the scope, outfitting new lab space can cost millions before any revenue from that space is realized. That’s a high-stakes bet, especially in a project-based business where client demand can shift quickly.
Then there’s the operational reality. New facilities require additional staffing, equipment, validation, and regulatory oversight—all of which add complexity. If demand surges unexpectedly, real estate may be too slow to respond. If it softens, you may end up with underutilized space.
This isn’t to say real estate shouldn’t be part of the growth strategy. It can be—especially for CROs with long-term contracts or steady demand in a core service area. But it’s not the only path. And increasingly, CROs are exploring other ways to increase capacity and diversify services without committing to permanent expansion.
A Smarter Way to Scale?
When space is tight and timelines are tighter, growth doesn’t have to mean breaking ground. Many CROs are expanding capacity by rethinking how they use the resources they already have—optimizing workflows, updating equipment, and reconfiguring space to do more with less.
This shift isn’t just about efficiency. It’s about strategic agility.
In a project-based business model, the ability to spin up new services, take on higher-throughput work, or pivot toward new therapeutic areas is often more valuable than sheer square footage. CROs supporting early-stage biotech, for instance, may need to move quickly to accommodate variable client timelines or novel modalities like cell therapy or gene editing. For them, agility often beats permanence.
We’re seeing more organizations:
- Streamline processes to reduce downtime and increase instrument utilization
- Reconfigure lab layouts to accommodate multipurpose workflows
- Cross-train staff to handle varied client protocols and technologies
- Invest in automation that boosts throughput without increasing headcount
This kind of adaptability supports both margin expansion and service diversification—without adding long-term overhead. It also positions CROs to compete for clients in emerging fields like personalized medicine, where programs may be short-term but require complex, high-quality outputs.
In short, physical space is only one dimension of capacity. By focusing on operational flexibility, CROs can grow faster and more sustainably—while keeping infrastructure lean and responsive to market shifts.
Leasing as a Growth Lever
When expansion is needed but new real estate isn’t on the table, equipment becomes the key variable. For CROs looking to increase capacity, support new services, or test client demand in emerging therapeutic areas, leasing lab equipment can offer a faster, more flexible way to scale.
Here’s why it works: leasing sidesteps the long procurement cycles and capital approvals that often slow down equipment purchases. Instead of waiting months for budget clearance or board sign-off, teams can bring in new instrumentation on timelines that match their client pipeline.
This can be especially valuable in project-driven environments, where:
- Demand fluctuates and capital investments carry risk
- Service lines shift based on therapeutic trends or client priorities
- Speed to onboarding determines whether you win or lose a contract
Leasing also aligns better with how CROs think about infrastructure: not as fixed assets, but as tools that need to stay current. If a piece of equipment is likely to be upgraded in 3–5 years—or is only needed for a two-year program—ownership may not offer much upside. In these cases, leasing provides access without locking up capital or taking on depreciation risk.
Some CROs use leasing tactically—for example, to spin up equipment for short-term pilot programs or high-throughput screening runs. Others build leasing into long-term strategy, choosing to lease mission-critical systems like LC-MS or qPCR platforms so they can scale or swap them as client needs evolve.
Either way, the value proposition is clear: more flexibility, less friction, and a closer match between infrastructure and actual project lifecycles.
When Leasing Makes Strategic Sense
Leasing isn’t a one-size-fits-all solution—but there are clear, recurring situations where it can offer CROs meaningful advantages over purchasing equipment outright. These use cases cut across therapeutic areas, business models, and client types.
- Fast onboarding for new clients: Whether you're supporting a startup in IND-enabling studies or taking on a new therapeutic area, leasing allows CROs to scale up instrumentation without waiting on internal capex cycles. If a client’s work is time-sensitive or short-term, flexibility matters more than ownership.
- Expanding service offerings without overcommitting: Want to offer analytical support for a new modality—say, cell therapy or gene editing—but unsure how long demand will last? Leasing provides a low-risk entry point. If the service line gains traction, you can reevaluate and scale. If it doesn’t, you haven’t sunk hundreds of thousands into niche equipment.
- Increasing throughput without increasing space: Even if your lab is physically maxed out, leasing can help you add redundancy or upgrade throughput with smaller, more efficient systems. Whether it’s benchtop sequencers, automated sample prep tools, or thermal cyclers, newer models can often double output per square foot.
- Bridging procurement delays or capital gaps: In some cases, the business case for a piece of equipment is clear—but internal purchasing processes, capital constraints, or corporate timing issues stand in the way. Leasing offers a way to bridge the gap and keep momentum, especially for CROs operating as subsidiaries or within PE-backed rollups.
- Supporting fluctuating or seasonal workloads: Some CROs, especially those tied to academic calendars or fiscal funding cycles, face seasonal swings in project volume. Leasing enables temporary capacity expansion without taking on long-term financial or maintenance burdens.
These aren’t edge cases—they’re part of the real operating rhythm for many CROs. And in each scenario, the goal is the same: match infrastructure to demand without overextending. When that’s the priority, leasing becomes less about financing—and more about operational strategy.
Matching Equipment Strategy to Project Risk
CROs rarely operate on autopilot. Every decision—especially those tied to infrastructure—comes down to timing, risk, and how confident you are in client demand. When it comes to acquiring equipment, the most strategic teams don’t just ask “lease or buy?” They ask:
- How long will this system be in use?
- How likely is this client to renew or scale up?
- What’s our fallback plan if the project slows down or stalls?
This is less about financial structuring and more about matching infrastructure decisions to operational risk. Some tools are foundational and justify long-term ownership. Others are client- or project-specific, where flexibility and timing matter more than asset control.
Here’s a practical way to think about it:
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This kind of risk-aligned decision-making helps CROs avoid common traps: sitting on idle equipment, slowing timelines due to capital delays, or locking into tools that don’t fit future workflows. It also positions them to scale services up—or down—without getting stuck in the wrong capital structure.
The bottom line? The smartest CROs build their labs like a portfolio—balancing long-term bets with tactical flexibility, and keeping optionality open when uncertainty runs high.
Growth Without Construction
For CROs, growth used to mean more space, more equipment, more of everything. But today’s most agile organizations are rethinking that assumption. In an industry where timelines are tight, client needs shift quickly, and capital is precious, the ability to scale without expanding your footprint is becoming a strategic advantage.
That might mean leasing equipment to bridge a demand spike. It might mean reconfiguring lab space, rethinking workflows, or piloting a new service without locking yourself into a long-term buildout. Whatever the approach, the goal is the same: keep infrastructure responsive to what your business actually needs—now, not two years from now.
The CRO market isn’t slowing down. As pharma pipelines diversify and biotechs look to outsource more R&D, the pressure to deliver faster, broader, and smarter services will only grow. Real estate will always play a role—but it’s no longer the only way forward.
With the right strategy, CROs can expand capacity, take on new opportunities, and stay ahead of the curve—without adding a single square foot.
Looking to scale without overcommitting? Excedr helps CROs access the lab equipment they need—without the upfront costs of buying or the delays of capex cycles.
Whether you're launching a new service line or expanding throughput, leasing can help you grow faster, more flexibly, and on your terms. Get in touch with our team to learn more.