This expansion means increasing demand for space. In greater Boston, this is driving the wave of demand for laboratory buildings, diagnostic centers and healthcare facilities.
Growth requires capital and talent. Nationwide, the National Institutes of Health (NIH), venture capital firms and corporate R&D collectively invested an estimated $125 billion in the pharmaceuticals and life sciences sectors in 2018. Locally, Cambridge trails only the state of California for total venture capital investment.
Over the past decade, growth rates in life science-related employment have been more than three times stronger than total U.S. employment. As capital has flowed into the sector, employment has increased - leading to greater demand for lab space. The region benefits from a strong talent pipeline generated through our many colleges and universities – including MIT and Harvard. Greater Boston is also a global leader in healthcare – home to Massachusetts General Hospital, Boston Children’s Hospital and Dana Farber Cancer Institute, among others.
From a composition perspective, the market is dominated by a mix of both Big Pharma and smaller start-ups. The advent of lab incubators such as SmartLabs has aided in the growth and proliferation of small companies. Historically, many smaller firms have gone on to be acquired by Big Pharma – contributing to drug development pipelines.
Greater Boston continues to be one of the hottest life sciences markets in the world - with over 20 million square feet of lab space and a near 0% vacancy rate. The regional pipeline of under-construction and proposed lab projects could potentially increase supply by more than 50% over the next five years.
Below are five takeaways of the Boston market from the Cushman & Wakefield’s Life Science 2020: The Future is Here report. Check out the full report to learn more about the life sciences sector around the country!