Boston Real Estate Market Reports

Boston Office Market

Greater Boston posted its first quarter of positive net absorption since early 2021, signaling early signs of stabilization. Large‑block activity remained strong in the fourth quarter of 2025, with the top six transactions each surpassing 115,000 SF. Direct leases continued to gain share in the CBD, accompanied by an uptick in average lease terms, an indication of rising tenant confidence in the urban office market. Suburban fundamentals have pushed many owners toward residential conversions, while other landlords are instead repositioning assets into industrial, R&D, or flex space. The retail/wholesale/manufacturing sector led office demand in the CBD this quarter, accounting for roughly 14.5% of the five million SF of active requirements currently tracked. Average asking rents across the metro were flat quarter‑over‑quarter, but up 2.1% year‑over‑year. Capital markets activity is showing renewed momentum, with a growing number of owner‑user acquisitions and lender‑facilitated transactions coming to market.

Boston Industrial Market

Greater Boston’s industrial market leasing activity outperformed 2024 levels, with leasing volume increasing roughly 36% above last year’s total. Vacancy continued to rise, reaching 9.6%, reflecting the cumulative impact of recent deliveries and strong demand for renewals and extensions. Nearly 1.5 million SF was delivered in 2025, with another 1.1 million SF under construction across the region. Sublease availability in the South and West submarkets has decreased from last year’s levels, despite a 12.7% increase in inventory from the previous quarter. Leasing activity outside the metro gained momentum, with large transactions along key corridors such as Route 146. Asking rents softened year-over-year, though remain near historic highs as landlords adjust pricing strategies in response to elevated vacancy and availability levels.

Boston Life Science Market

The life science labor markets remain sluggish, with layoffs persisting and job postings continuing to decline through the second half of 2025. Select fundamentals have reversed course this quarter, with positive net absorption, and a 20-basis-point decrease in both vacancy and availability welcomed across the region. Leasing activity was flat quarter-over-quarter, the lack of access to capital and limited exits as well as ongoing economic uncertainty are driving tenant cautiousness, limiting overall demand. Select subleases are beginning to expire and revert to the landlords, with sublease availability down 100 basis points on the year and are at their lowest level since the second quarter of 2023. IPO activity remained very limited on the year; however, venture capital funding saw a much welcome uptick in the second half of the year, outpacing the first half by 61.0%. The development pipeline continues to wind down, with 2025 seeing square feet under construction as a percentage of existing inventory decrease to levels not seen since 2011, hovering around 6.0%. Many landlords of existing and potential laboratory sites are exploring alternative uses, such as office, flex, or multifamily, due to such limited demand in the life science leasing market.