BOSTON—Lab vacancy is down to 2.4 percent in Greater Boston, but the completion of 1.2 million square feet of new inventory is expected in Cambridge over the next four quarters, according to a report by Boston-based Perry Brokerage Associates, a full-service commercial real estate services firm.
Here are the highlights from the second quarter 2017report from Perry Brokerage:
- A 16th straight quarter of positive absorption as vacancy dips 0.2 percent to 2.4 percent.
- An expectation of 1.2 million square feet of new completions over the next four quarters in Cambridge.
- A critically low level of available space in Cambridge, with most mid-size options in the Central submarket.
- The deployment of two local operations of Chinese-based pharmaceutical groups, a growing trend, and
- The impending occupancy of headquarters facilities for Bluebird Bio and Sanofi Genzyme in Cambridge.
The report also takes a look at what has been a continued blistering pace of construction, with nearly three million square feet of space either newly underway or delivered over the last two years.
Here are the other highlights:
- Cambridge vacancy remained at near a record low, rising 0.1 percent to 1.3 percent on flat absorption of negative 12,000 sf.
- Completions of 1.2 million sf expected over the next four quarters will spur some absorption and open a level of availability, though current tight conditions leave nearly no room for new or expanding occupants.
- Five of seven availabilities in the 20,000 sf to 50,000 sf range within the next 12 months are in the Central submarket.
- Construction is underway on 165,000 sf at 399 Binney Street, the last defined development parcel at One Kendall Square.
- Alexandria Real Estate Equities acquired 303 Binney Street, a parcel envisioned for a 164,000 sf Lab building, from Metropolitan Pipe and Supply for $80 million.
In Boston and the rings:
- Positive absorption of 34,000 sf lowered vacancy 1.0 percent to 4.5 percent in the 128 Ring, while flat absorption kept vacancy stable at 2.5 percent and 5.4 percent in the Streetcar Ring and 495 Ring, respectively.
- Two contiguous choices larger than 50,000 sf in 128 Core represent the best larger available selection outside of Cambridge.
- Qilu Pharmaceuticals moved into a 25,000 sf owned building in Boston as Shandong Luye Pharmaceuticals took occupancy of 13,000 sf in Woburn, two China-based operations to open area facilities in the quarter and part of a longer-term trend.
- King Street Properties began construction on a 145,000 sf speculative facility at 828 Winter Street in Waltham.