I asked JLL’s Pam Paddock, Managing Director of Life Sciences, what’s most top of mind for her right now.
“Digital influence — how technology is changing the needs,” she said. “You can see it in the report itself: there’s a difference in the space needs of an entity that’s moving toward AI and automation. Even how large those research teams are in the development of new products — ultimately, that will impact manufacturing.”
According to JLL’s Life Sciences Real Estate Perspective and Cluster Analysis released this month, AI-native biotech firms are leasing about one-third less space than traditional sector benchmarks – driving what the firm calls a coming “mass reconsideration” of real-estate footprints as technology changes “who does research, and where.”
In contrast to the pharma manufacturing boom taking place, the AI wave comes at a perilous time for lab real estate.
JLL says U.S. lab vacancy spiked from 6.6% in 2022 to 27% in 2025 — quadrupling in three years. Nearly half of labs built since 2022 sit empty.
Driving this: a combination of uncertainty around federal R&D funding and venture capital prioritizing AI investments – biotech’s share of VC dollars has fallen from ~15% to ~7%.
JLL forecasts it could take up to seven years for surplus lab inventory to stabilize, likely through distressed sales and repurposing.
“An elevated focus will be placed on compute power, space for robots for automated tasks and sensors for smart labs,” JLL predicts.
⚙️ The Standard & Works View:
Legacy life science hubs rich with AI talent like Boston, San Diego, New York, and New Jersey may be among the first to be reinvented by this shift.
👉 New Jersey’s Health and Life Science Exchange (HELIX) development project will eventually host plug-and-play lab space for smaller companies.
