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Northwest
Life Science Report
q2 2021
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The Q2 2021 Northwest Life Science report includes data and analysis from Puget Sound, Portland, Sacramento, combined with Bay Area markets of the Peninsula, East Bay, San Francisco and Silicon Valley. Currently there is 48 million square feet of inventory across the seven markets. The largest cluster of which is in the San Francisco Peninsula at 15.6 million square feet.
Market insights
Market Insights
There is currently 5.1 million square feet under construction in the Northwest. When under construction square footage is compared to current inventory, the resulting growth rate is 10.6% overall. Portland reported the highest rate of 24.6% due to 304,892 square feet under construction in a market of 1.2 million square feet.
Puget Sound has the lowest vacancy and availability rate of any Northwest market. Silicon Valley has the highest at 18.8% and 23.3%, respectively.
When vacancy rates and under construction as a share of total inventory are compared, the markets with some of the highest vacancy rates have no current under construction projects, indicating a supply balance. The markets with double digit under construction rates all have vacancy below 9%.
The Bay Area reported the highest asking rates in the region.
Leasing, Development & Capital Markets
There are currently 40 active tenants in the region totaling 3 million square feet. By square footage, 55.3% of the active tenants are in the San Francisco Peninsula and Silicon Valley markets. The average size overall of tenant requirements is 75,453 square feet.
The largest Q2 2021 lease transactions resulted in an average transaction size of 58,326 square feet after 19 leases were inked totaling 1,108,192 square feet.
Grant funding from the National Institutes of Health (NIH) and private investment from venture capital is the backbone of the Life Science ecosystem. Year-to-date, San Francisco has received more NIH funding than any other Northwest market.
The fundamentals of Life Science in the Northwest Region remain strong and are poised for further investment.
Market Fundamentals
Count of Top Sales
Total Sales ($)
Total SF of Sales
Price Per SF
Average Price
11
$1.4 Billion
3.1 Million
$441
$125 Million
Seattle reported the highest tenant improvement allowances at $190 per square foot, though the Bay Area was not far behind. The East Bay, Peninsula, and Silicon Valley all reported allowances ranging from $75 per square foot to $175 per square foot. Total fit-out costs were highest in the Bay Area, topping out at $450 per square foot.
Of the largest sales reported in H1 2021, 11 sales were completed in the region totaling $1.4 billion and an average price per square foot of $440.85. Capital markets is expected to remain a focus of investment strategies due to increases in funding.
Funding & Investments
Source: Colliers, National Institutes of Health
Year-to-date, San Francisco has also received the most private and venture capital funding at over $6 billion.
Source: Colliers, Crunchbase
According to Q2 2021 development pipelines, construction is highest in the San Francisco Peninsula with 59.3% of the projects pre-leased. In the Northwest overall there is 10.1 million square feet of new construction that is 53.6% pre-leased. This includes four 100% pre-leased developments and six 0% pre-leased projects. There is currently over 9 million square feet of proposed construction in the region, the most coming from Sacramento.
Allyn Thorpe Senior Regional Analyst | USA Allyn.Thorpe@colliers.com
Jacob Pavlik, MRED | CPRC Research Manager | Pacific Northwest Jacob.Pavlik@colliers.com
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Source: Colliers
View our regional insights by scrolling down this page.
For local market insights and to download market specific reports, click the button above.
Q2 2021 Market Insights
Puget Sound
Portland
Silicon Valley
SF Peninsula
SAN FRANCISCO
SACRAMENTO
EAST BAY
CALIFORNIA
Oregon
Washington
Below are links to maps, graphs, and commentary that have been created for the Northwest Region, related to how life science companies are funded, where they are in relation to transportation options, and educational attainment.
Click to view Market Insights
Total Funding 2021 YTD
$833 million
10 Year Average Funding
$363 million
% Public Funding (this year)
10.1%
Educational Attainment
2021
Q2
East Bay Market
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Funding
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University of California at Berkeley recently announced that it is opening Bakar Labs, a major biotechnology incubator program for as many as 80 companies once it opens later this year. This is an expanded benefit for the region’s life science pre-eminence, as more companies will have a place to experiment and develop a wide-variety of products and innovations.
% Private Funding (this year)
89.9%
So far in 2021, East Bay has received more than double its 10-year average funding, mostly from venture capital in the early (Series A) and late-stages (Post-IPO equity).
Lisa Kohler Senior Research Analyst | Pleasanton Lisa.Kohler@colliers.com
Rob Gerard Senior Research Analyst| Oakland Rob.Gerard@colliers.com
William Chu Research Analyst | Oakland William.Chui@colliers.com
Cristian Villarreal Research Analyst | Walnut Creek Cristian.Villarreal@colliers.com
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$172 million
$305 million
68.1%
31.9%
So far in 2021, Sacramento has received over half its 10-year average funding, with more than two-thirds coming from NIH and less than one-third from venture capital, although the $55 million coming from the private markets is entirely in Series D funding. Sacramento area generally receives more than 99% of its funding from NIH, making 2021 a year of rapid growth for venture capital.
February 24, 2021
SACRAMENTO Market
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Bob Shanahan Research Manager | Sacramento & Reno Bob.Shanahan@colliers.com
University of California at Davis has a Digital Agriculture Library that examines food systems with an eye for sustainable development and waste reduction. While proximity to the seat of California’s state government may not translate to political influence, it cannot hurt to have a world-class university nearby providing actionable insights into the world of increasingly fragile food systems.
So far in 2021, San Francisco has received more than triple its 10-year average funding, mostly from venture capital in the middle (Series C) and late-stages (Post-IPO equity and Series E).
San Francisco Market
$6.6 billion
$2.0 billion
8.4%
91.6%
Erin Proto Senior Research Manager | San Francisco Erin.Proto@colliers.com
University of California at San Francisco receives more National Institutes of Health funding than any other recipient of biomedical research funding. It can also count 5 Nobel Laureates among its graduates. Genentech is one of the more than 200 companies that have started from UCSF’s research.
So far in 2021, SF Peninsula has received more than triple its 10-year average funding, mostly from venture capital in the mid (Series C) and late-stages (Post-IPO equity).
SF Peninsula Market
$3.4 billion
$952 million
0.3%
99.7%
The Stanford Line Accelerator Center (SLAC) is where the school’s research into SARS-CoV-2, the virus that causes COVID-19, is taking place. Four Nobel Laureates did their work through SLAC. College of San Mateo has 2-year undergraduate programs providing a key talent pipeline of technical workers for the many life science occupiers around the Bay Area.
Lena Tutko Senior Research Manager | Silicon Valley Lena.Tutko@colliers.com
So far in 2021, Silicon Valley has received nearly triple its 10-year average funding, mostly from Series C and D venture capital funds and an uptick in NIH funding.
Silicon Valley Market
$421 million
$148 million
20.1%
79.9%
San Jose State University ranked in the Top 30 universities for the 2021 Times Higher Education Impact Rankings, showing a commitment to meeting the United Nation’s 2015 Sustainable Development Goals, making the university a global leader in innovation.
So far in 2021, Portland has received 80% of its 10-year average funding, mostly from an uptick in venture capital funding in Series C and E and post-IPO Debt.
Portland Market
$289 million
67.5%
32.5%
Oregon Health & Science University partners with Oregon State University and Portland State University to provide cross-disciplinary and collaborative work in life sciences. Their work takes place in the Robertson Life Science Building sits on the west side of the Tilikum Bridge—a pedestrian, bike, and transit-only crossing of the Willamette River.
So far in 2021, Puget Sound has received nearly three-quarters its 10-year average funding. The primary growth from prior years is in early-stage (Series A and B) funding, which make up nearly half of all private funding, and post-IPO equity, which makes up a third of private funding.
Puget Sound Market
$902 million
$1.2 billion
30.4%
69.6%
Completed in summer 2018, University of Washington’s Life Science Building places labs, classrooms, and common areas near each other in order to spur spontaneous interactions and foster a collaborative environment. This school is also the source of more NIH funding and spin-off companies than any other institution in Washington state.
Nich Carlsen Research Analyst | Puget Sound Nicholas.Carlsen@colliers.com
Q2 2021 LOCAL MARKET REPORTS
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