Last year Life Science inventory in the top 3 clusters, Boston, San Francisco & San Diego, grew by over 10%. With this incredible growth, combined with softer space demand, many existing properties felt pressure on fundamentals. The biggest impact was on properties over 10 years old. In a two year period, those properties lost 610 bps of occupancy, falling from 90.8% to 84.7%. Properties delivered in the last 2 years currently sit with less than half leased. Life Science buildings delivered just before this period however, have not seen the same occupancy losses. Buildngs between 3 and 10 years old have a current occupancy of 91.1%, a decline of only 90 bps in the same period. Many of these buildings were completed when demand was high and available space was scarce, making them somewhat insulated compared to older properties with leases expiring. In 1Q of this year, completions dropped significantly allowing many markets to begin to stabilize after the occupancy declines of 2023 and 2024. Follow this and other trends by subscribing to Revista!
