The Boston area has become one of the hottest areas in the world for life sciences companies. With inventory low and demand high, prices have skyrocketed, especially in East or Central Cambridge, where some landlords are charging $60 per square foot triple net.
Meanwhile, the life sciences industry is on track to set a record with the most IPOs in a single year. Strong capital growth after the IPO is causing signification growth and hiring for these companies. That being said, these companies continue to look for value lab spaces. For those being priced out, there’s still hope, even in urban areas – you just have to know where to look.
First, search for existing infrastructure. A crucial strategy when looking for valueis to find space that is already built out as a lab, which will save both the landlord and the tenant money. There’s even an advantage to second or third generation lab spaces and retrofitting labs can save the life sciences company money and capital.
Second, ask your broker to engage your existing landlord to see if they have a creative option they could piece together. Landlords are more apt to purchase a lab capable property in a value play market knowing that they have one of their tenants who may be interested in that site. This takes out some uncertainty on behalf of the landlord as they underwrite the risk profile of the deal.
Here is our list of good deals for life science leases in the Greater Boston area.
- Drydock Avenue: This Boston address in the Innovation District comes in at a low $30 psf NNN. There is lab space available at 27 Drydock Avenue, and companies at this address already include Dana Farber and Ginkgo Bioworks.
- Watertown: Tenants are being drawn to this area because of its proximity to Cambridge, MIT and Harvard, and access to young talent who live just outside the city. Addresses with lab space include: 480 Arsenal Street and 313 Pleasant Street. Life sciences companies can get a space at mid $40s psf NNN.
- West Cambridge: This part of Cambridge is extremely active right now. For example, 200 Cambridge Park Drive in West Cambridge is priced at low $40s psf NNN and is a former Pfizer building with great existing infrastructure. This area’s accessibility to the MBTA Red Line is making West Cambridge one of the new hot spots for lab spaces.
- Lexington: This suburb, just 10 miles up Route 2 from Cambridge, is a comfortable commute for those used to being in Cambridge. Hartwell Avenue in particular has become its own biotech hub with 44 and 113 Hartwell Avenue now home to several life sciences companies. Rents are in the $30s psf NNN range.
- Moving north up I-95, 18 Crosby Drive and several lab capable buildings on Burlington Road in Bedford, offer mid to high $20s psf NNN.
- Waltham. Heading south to Waltham at 285 Bear Hill Road, rents are mid $30s psf NNN. There’s a cluster forming in Waltham due mostly to Alexandria’s investment in the area.
- Needham: 117 Kendrick Street is seeing rents at $30 psf NNN.
- Woburn. 14 Gill Street has rents in the mid $20s psf NNN. Cummings Properties has created an extreme value play lab cluster in this area.