Astellas Pharma’s 63,000-square-foot lease at Cambridge Crossing’s 441 Morgan Ave. was the largest local lab lease of the third quarter. Image courtesy of Ennead and Jacobs Consultants

Double-digit availability rates are the new norm for lab space in Greater Boston, with only the industry hub of East Cambridge avoiding the full force of the market downturn.

The Boston life science market recorded its second straight quarter of negative absorption, amid sluggish leasing and new listings of sublease space by biotechs, according to brokerage research.

Boston’s Seaport District attracted spillover demand for industry expansion in recent years, when East Cambridge availabilities remained in the low single digits and gave biotechs few leasing options. The 3.6 million-square-foot Seaport submarket now has a 22.7 percent availability rate, according to brokerage Newmark’s third quarter report.

The neighborhood is set to add major office-lab projects currently under construction including the 500,000-square-foot 2 Harbor St. and the 518,000-square-foot 10 World Trade. The Seaport District has recorded five straight quarters of negative absorption, according to CBRE.

East Cambridge also had over 105,000 square feet of negative absorption during the third quarter, and ended the quarter with an 8.7 percent availability rate, Newmark reported. Astellas Pharma’s 63,000-square-foot lease at Cambridge Crossing’s 441 Morgan Ave. was the largest transaction of the quarter.

Newmark is tracking 1.6 million square feet of tenant requirements across Greater Boston, while 3.5 million square feet of new lab space is scheduled to deliver by the end of the year. Approximately half of the new space is preleased.

Venture capital investment has since retreated to pre-pandemic levels, with local companies receiving $1.4 billion during the quarter. In 2021, venture capital funding for Greater Boston companies totaled $15 billion, according to researchers DealForma.

Lab Market Takes Another Step Back in Q3

by Steve Adams time to read: 1 min