Life sciences is the rare beat where every demand indicator points up — biotech employment at records, venture funding recovering, M&A and licensing active — while vacancy sits near 23%. The gap is a supply story. Hubs overbuilt speculative lab space into a development cycle that outran absorption.

The correction is already underway: construction starts are slowing, which is the precondition for vacancy to peak and reverse. But the overhang is large enough that headline rents and concessions will stay tenant-favorable in the near term.

Composition is the underwriting key. Manufacturing- and GMP-oriented facilities are leasing while generic bench-lab boxes languish. Treating "life sciences" as one asset class is how sponsors mispriced this market on the way up.

For developers and capital partners, a strong jobs print is not a leasing thesis. The diligence question is delivery timing against a market still absorbing a supply wave, and the spec premium has flipped to purpose-built manufacturing space. Bench-lab repositioning and concession-heavy lease-up should be in every base case for the next several quarters.

➤ TAKEAWAY

In life sciences, demand never broke — supply did. Price the overhang, not the optimism.

Source: Cushman & Wakefield / PwC-ULI Emerging Trends