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May 18, 2023
Originally published on May 15, 2023, by Patricia Kirk for UrbanLand Magazine.
Given a marked flight-to-quality and declining demand for office space overall, older office assets are increasingly being converted to other uses. And of the 125 office conversion projects currently underway, half are being adapted for life science use, according to Jessica Morin, CBRE Americas head of office research.
The high percentage of office conversions to life science compared with other product types is understandable considering the overlap in these two uses, suggests Devin Bertsch, project director for San Francisco-based Project Management Advisors. Bertsch, who specializes in life science development and construction management, notes that the amount of floor space converted to lab use is usually 50 percent or less of the project, but conversions generate rents comparable to new ground-up life science projects.
The first quarter of 2021 saw a peak in life science conversion projects, accounting for 41.5 percent of lab product created, says CBRE associate research director for life sciences Taylor Stucky. Another 31 percent of the life science space delivered in the fourth quarter of 2022 was also conversions.
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