Commercial real estate woes: Lab edition
It’s becoming increasingly clear that we don’t need as much office space as we used to, and it’s not just cubicle-crammed complexes that are sitting empty. Indeed, like particularly uninspiring biology lecturers, American developers are struggling to get people into their labs.
According to data from real estate insights firm JLL, reported by the Wall Street Journal this week, almost 1 in 4 American life-sciences buildings were vacant in Q2, as demand for pharmaceutical and biotech properties continues to flatten following the pandemic-inspired boom. For comparison, the vacancy rate sat around the 7% mark as little as 2 years ago, when companies in the sector rushed to move into buildings once reserved for financial institutions in the bustling city centers of New York and London.
Many US property developers are reacting to the glut by converting the empty lab space into more traditional office environments — a decision which, if you’ve kept even half an eye on broader office vacancy rates in America in recent years, might seem perplexing.
According to data from real estate insights firm JLL, reported by the Wall Street Journal this week, almost 1 in 4 American life-sciences buildings were vacant in Q2, as demand for pharmaceutical and biotech properties continues to flatten following the pandemic-inspired boom. For comparison, the vacancy rate sat around the 7% mark as little as 2 years ago, when companies in the sector rushed to move into buildings once reserved for financial institutions in the bustling city centers of New York and London.
Many US property developers are reacting to the glut by converting the empty lab space into more traditional office environments — a decision which, if you’ve kept even half an eye on broader office vacancy rates in America in recent years, might seem perplexing.
