Q2 2022 Silicon Valley Medical Devices Report

Over four million square feet of unleased space is slated for delivery in the next two years, spanning traditional office to fully R&D space. With traditional office space, landlords are having trouble landing long term tenants. As a result, there is additional pressure to allow for TI buildouts to convert traditional office into medical device space for long term, credit worthy tenants. 

All top transactions of the quarter transacted on a direct basis and above the average footprint of medical device users, indicating a growing need for specialized medical device office space. BD Biosciences recorded the largest transaction of the quarter, leasing 240,000 square feet at 135 & 155 N McCarthy Blvd. in Milpitas. Intuitive Surgical followed by taking 101,893 square feet at 111 Uranium Dr. in Sunnyvale. Elixir Medical took 53,667 square feet at 920 N McCarthy Blvd. in Milpitas, Nodexus took 26,090 square feet at 2130 Gold St. in San Jose, and iCAD took 24,351 square feet at 101-115 Nicholson Ln. in San Jose. 

Venture Capital deal count has decreased since the pandemic’s inception. Q2 recorded a 22.8% decrease in total number of deals done compared to the past 2 year’s average number of deals. On the contrary, Q2 recorded a 14.0% increase in capital invested compared to the 2-year average. Although deal count has decreased, the amount of capital poured into each deal has increased, meaning more mature companies are receiving funding and in increasingly larger amounts.