The life sciences industry faced numerous challenges in 2024, such as geopolitical tensions, a slow economy, and high interest rates that affected its growth.
However, despite these obstacles, the global venture capital increased along with mergers and acquisitions. The US also experienced record employment growth in this sector. According to CBRE’s “US Life Sciences Outlook 2025” report , the industry is currently going through an era of unprecedented innovation and discovery.
Looking ahead to 2025, both CBRE and Cushman & Wakefield predict that funding will continue to flow into the life sciences sector. They also anticipate a potential recovery for commercial real estate (CRE). In their “Life Sciences Funding in View: 2025 Outlook” write-up , Cushman & Wakefield stated that they expect investor enthusiasm for ongoing innovation within this field will drive continued economic strength.
CBRE analysts believe that the resilience of the US economy will contribute significantly to driving revenues within this industry forward. They also noted other positive factors such as improving capital markets conditions; record employment levels; growing demand for lab space; ongoing advancements in pharmaceuticals research including cell therapy and gene therapy; as well as clinical trials developments.
In terms of real estate impact on this sector moving forward into next year – according to CBRE – there was a decline during last year when it came down specifically towards sales related activities involving R&D properties or laboratory spaces which hit their lowest level over ten years due mainly because interest rates were higher while supply-and-demand fundamentals remained weak at best . However now with better macroeconomic trends taking place alongside more robust demands from buyers coupled together lower borrowing costs we can expect investment sales activity should pick up again throughout all remaining months left inside current calendar cycle although one possible headwind could be seen coming from new deliveries set occur first half next year .
Cushman & Wakefield concurred by stating deals are expected increase during upcoming twelve month period signaling start CRE recovery. They also mentioned how there has been a noticeable decrease within construction pipeline which should give this industry some much needed breathing room. As leasing activity continues to pick up, we can expect more space being absorbed in the coming year as well.
Additionally, Cushman & Wakefield analysts added that companies with strong financial backing are better positioned to make long-term decisions such as increasing their workforce and expanding their physical footprint within this sector.
