Boston Office Market
Despite remaining well above historic norms, office vacancies in Greater Boston have only increased by 60 basis points since the end of 2024, marking the lowest three quarter-increase since late-2021. Large-block transactions gained momentum in the third quarter of 2025, with the top six deals each exceeding 100,000 SF. Direct leases continue to gain share of overall activity in the CBD, accompanied by an increase in average lease term this quarter, reflecting greater tenant confidence in the urban office market. Suburban office market fundamentals have prompted many owners to pursue residential conversions of existing assets. However, select owners are focused on building out industrial-R&D/Flex space. The financial, non-banking sector surpassed the legal sector in office demand in the CBD this quarter, representing roughly 19.0% of active requirements, or roughly 862,000 SF of the 4.5 million SF currently tracked. Average asking rents across the metro rose 1.6% quarter-over-quarter, driven primarily by new construction activity that continues to elevate lease rates within the Class A sector. Capital markets across Greater Boston are showing signs of renewed activity, with an increasing volume of owner-user acquisitions and lender-facilitated transactions coming to market.
Download Boston Office Market Report 3Q25Boston Industrial Market
Greater Boston’s industrial market recorded positive net absorption in the third quarter of 2025, marking the first quarterly gain in nearly two years. More than 800,000 SF of industrial product was delivered this quarter, decreasing RBA under construction to its lowest level since Q1 2019. Notably, 51.9% of the delivered space was build-to-suit. Leasing activity continues to outperform 2024, with third-quarter 2025 deal volume sitting roughly 57.0% above year-ago totals, and year-to-date activity is up notably as well. Industrial vacancy in the Urban submarket held steady quarter-over-quarter, while all other submarkets saw an increase in vacancy rates. Sublease availability decreased 11.5% quarter-over-quarter. This was offset, however, by a 5.5% increase in direct availabilities, leading to a net 40-basis-point increase in overall availability. The Urban submarket remains the most supply constraint, continuing to boast comparatively low availability as well as the highest average asking rents. Asking rents for industrial space in Greater Boston rose slightly in Q3 2025 to $16.11/SF, though rates remain 3.3% below the historical peak recorded in Q1.
Download Boston Industrial Market Report 3Q25Boston 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. Fundamentals across the region continued to unwind this quarter, albeit at a slower pace, with slight increases to vacancy, availability, net negative absorption, and a noticeable decline in asking rents. While leasing activity doubled 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, putting upward pressure on direct availabilities, which have increased by more than 10% since the beginning of the year. IPO activity remained very limited; however, venture capital funding saw a much welcome uptick on the quarter. The development pipeline continues to wind down, with the delivery of two fully-available office-to-lab conversions representing the only new product to come online during the third quarter of 2025. 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.