Boston Office Market Report
Boston Processes Effects of Financing Shocks;
Development Set to Weigh on Fundamentals
Office market feels impact of Silicon Valley Bank collapse. The failure of one of the nation’s largest financial institutions poses unique implications for Boston’s office segment, as it was a notable source of funding for both local tech and life science startups. This arrives amid decelerating demand in the latter sector, with owners of laboratory facilities reporting some difficulty securing new tenants. The segment will likely see significant upward pressure on vacancy from the square footage scheduled to come to market in the coming months. Still, the metro’s biotech segment is in a much stronger position than traditional offices. Lab vacancy in Cambridge and Boston proper remains in the low single digits as of early 2023, notably lower than the overall availability rates observed in these locales of 11.5 and 16.0 percent, respectively.