Q4 2022 Lab Market Overview Report

San Francisco Q4 2022 Lab Market Overview 

Headwinds as a result of macro pressures
Investors are recommending their portfolio groups to be conservative in terms of growth over the next 12 months. Tenants are being advised to be cautious taking more space or making financial commitments than what is absolutely necessary.

Rental rates remain strong 
Direct landlords have remained and will continue to remain confident in rental rates. Additional lease value will be found in the form of concessions rather than reduced rental rates.

More options for tenants 
Influx of sublease supply has pushed up inventory, giving tenants leverage with more options than previously available. Direct landlords will have to compete with sublease supply as subleases provide potentially discounted rental rates, flexible lease terms, speed to occupancy, and minimal capital costs for buildouts.