When most people think of commercial real estate investment in the Boston Metro, the categories of office, retail, multi-family and industrial easily come to mind. Yet one of our strongest commercial sectors is a growing niche: lab space.
According to the Boston Business Journal, the Boston Metro area leads the world in early-stage biotech research. It has 37,339 workers involved in research, testing and medical laboratories. From 2012 to 2015, on a per capita basis, Massachusetts ranked #1 in venture capital investment, life science patent awards and funding from the National Institutes of Health.
Boston’s rise in biotech has lead to burgeoning demand for lab space. The Economist reports that Boston Metro area rents for lab space rose by 7% during 2015. Meanwhile, commercial real estate analysts at JLL report that the Cambridge lab market is experiencing unprecedented low levels of vacancy at 0.8%.
The biotech boom has caught the attention of institutional investors. The JLL Global Capital Flows report states that Boston commercial real estate is ranked as the 10th most-traded in the world, with $4.6 billion in total volume during the first half of 2016. Boston’s lab space is among the most in-demand asset class in U.S. commercial real estate.
A key institutional player in the lab market is Blackstone, which is in the process of converting some Boston office space to lab space. Blackstone’s confidence in the lab market was evidenced in its acquisition of BioMed Realty and its lab portfolio for $4.8 billion. BioMed, which has offices in Cambridge and several other cities, was founded in 2004, and specializes in commercial real estate for the life sciences industry.
The demand for lab space in the Boston Metro is one of the reasons our commercial real estate market is ever-changing and unique. Obtaining professional advice and tenant representation is a must when making commercial real estate decisions.
Ready to begin, relocate or expand your business? Team up with an experienced commercial real estate broker at Jay Nuss Realty Group, LLC! Whether you are thinking of buying or leasing Boston Metro commercial real estate, we can help you find the ideal property. Please contact us today for expert guidance!