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Bay Area Life Science Space Demand Normalizes to Pre-Pandemic Levels
Life science real estate vacancies in the Bay Area rose to 8.2% in the first quarter of 2023 from 6.1% in Q4, Transwestern’s George Entis reported. Normalizing demand for lab space, coupled with a deepening development pipeline, pushed vacancies up to pre-pandemic levels.
Q1 leasing activity was muted as the four-quarter total reached 1.6 million square feet, a 55.4% pullback from the year-ago period. Entis reported that rent growth moderated considerably from the “blistering pace” of a year ago, declining 28.9% year-over-year to $4.05 per square foot
Driven by biotechnology and other advancements, the Bay Area life sciences industry continues to see elevated levels of venture capital funding, which recorded $1.6 billion in capital flows in Q1. Although VC funding has gradually declined since peaking a year ago, capital invested in Q1 was comparable to pre-pandemic levels, reported Entis.
- ◦Lease


