Boston Office Market
Greater Boston recorded its thirteenth consecutive quarter of rising vacancy, though the pace of increase has slowed significantly. Tenant activity picked up in the first quarter of 2025, with a noticeable rise in tour volume across the region. While overall leasing velocity softened during the quarter, the market saw a modest uptick in new transactions, as more tenants are starting to commit to long-term leases. In Boston鈥檚 CBD, active tenant demand was 4.1 million square feet across 166 requirements. The FIRE sector represents the largest share at 37% of total demand. Sublease availability declined by 50 basis points since the start of 2024 as expiring subleases convert to direct availabilities, keeping overall inventories elevated. Face rents remain stable across the region, while landlords continue to offer more aggressive deal terms to secure transactions. Greater Boston鈥檚 capital markets are beginning to thaw, with a growing number of owner-user and lender-facilitated transactions emerging.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鈥檚 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, 鈥淏ig Pharma鈥� 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.