Boston Real Estate Market Reports

Boston Office Market

Renewals and extensions continue to outperform other lease types, highlighting tenants’ cautious approach to committing to new spaces in the current market environment. Following historically low levels in the first half of the year, leasing activity rebounded this quarter, totaling 2.6 million SF. The second half of the year outpaced the first by an additional 1.0 million square feet. Landlords continue to examine other development opportunities in Greater Boston, highlighted by local governing initiatives and redevelopment opportunities. Capital markets in Greater Boston are beginning to show signs of increased liquidity. While transaction volumes remain below historical averages, improved clarity on expectations has spurred a gradual uptick in activity.

Boston Industrial Market

Despite below-average metro area unemployment, local job growth in most industrial-using sectors remained stable over the last 12 months. Industrial vacancy rates for Metro Boston increased for the eleventh straight quarter, reaching a new historic high of 8.2% in the fourth quarter of 2024. The Urban submarket remains the most supply constraint, continuing to boast comparatively low availability as well as the highest average asking rents. The Class A Warehouse subtype experienced limited leasing velocity as users remain focused on the smaller blocks of industrial space, resulting in 2024 recording the lowest leasing volume in the past 10 years.

Boston Life Science Market

Market indicators are still muddled, suggesting Greater Boston’s life science market continues to search for a bottom. The reopening of the IPO window led six local biotech companies to go public in 2024. Post initial offering performance has struggled though. Over the past year, “Big Pharma” invested more in mergers and acquisitions than in 2022 and 2023 combined. Greater Boston venture capital funding increased by nearly 47.0% during the second half of 2024, bringing annual volumes to $7.5 billion.