NEW YORK, September 4, 2025 – The global life sciences industry is navigating a period of rapid transformation in 2025, according to Cushman & Wakefield’s Life Sciences 2025 Midyear Update. While industry trends like artificial intelligence (AI) is reshaping drug discovery and clinical trial efficiency and has the potential to impact the built environment, the sector faces headwinds from market uncertainty, shifting supply chains, and emerging drug classes that will redefine the space needs of the industry.
Key Findings from the Report Include:
Global Market Conditions
- Leasing Slowdown: Global life sciences vacancy has risen to 23.3% as uncertainty slows leasing activity.
- Capital Markets: R&D capital markets showed renewed momentum in the first half of 2025, with transaction volume surging 42%. However, venture capital funding declined to $18.0 billion, down 16% year-over-year, while IPO activity fell sharply to $2.3 billion (-58% YOY). M&A activity also slowed, totaling $86 billion—a 23% decrease compared to 2024.
United States Outlook
- Softening Rents and High Vacancy: Asking rents have declined as vacancy reaches record highs. Concessions such as free rent, AV/IT allowances, and turnkey build-outs have become standard.
- Constrained Construction: The U.S. construction pipeline now accounts for only 3% of existing inventory, with 63% of new space already pre-leased, signaling a shift from speculative to build-to-suit projects.
- Robust Sales, Resilient Labor: U.S. R&D sales totaled $8.6 billion over the past year, up 63% YOY, while hiring activity has remained strong, aided by more slack in the labor market.
- Emerging Market Advantage: Secondary and emerging markets continue to provide cost-effective alternatives for both real estate and talent.
“Life sciences companies are balancing opportunity with uncertainty,” said Sandy Romero, Head of Life Sciences and Healthcare Insights at Cushman & Wakefield. “AI adoption, GLP-1 innovation, and resilient demand drivers highlight the industry’s growth potential, even as macroeconomic and policy headwinds test the sector’s agility.”
Explore the Life Sciences 2025 Midyear Update.