Converting underused commercial space into life science labs in the Bay Area is no longer as popular as two years ago when the biotech boom during the pandemic drove life science leasing activity to record highs.
The wave of new supply generated by that surge of activity now is cresting over a much cooler market with surging vacancy rates.
At the end of the second quarter, the total inventory of life science facilities in the Bay Area stood close to 42M SF, of which nearly 25% currently is unoccupied. This includes 8M SF of direct vacancies and 2.2M SF of vacant sublease space, according to CBRE's latest market report.
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