JM Electrical: 2021: CRE Trends to Watch in Massachusetts
While 2020 was a tumultuous year for the Greater Boston economy, our regional construction and development sector continues to provide an essential service, supporting numerous local industries and underpinning the area’s status as a hub for innovation. And as the new year gets underway, there is significant growth potential for the industry as many more projects are approved and funded. As discussions continue for a national infrastructure bill in Congress, which would help stimulate job growth across the country, we thought it would be useful to highlight several Massachusetts-specific trends on track for the year ahead.
To be sure, Massachusetts will remain at the forefront in terms of a robust national response to the pandemic. For instance, as the newly authorized COVID-19 vaccine from Cambridge-based Moderna is distributed for administration across the United States, the valuable vials will be transported inside a product made by Franklin-based Cold Chain Technologies.
Here in the Boston area, city and construction officials will continue to explore how best to implement necessary virus-related protocols. For instance, the Greater Boston Building Trades Unions recently joined with Partners In Health, Harbor Health Services, and the City of Boston to forge a new national model for coronavirus prevention. This first-in-the-nation collaboration will lead to the creation of coronavirus testing, tracing, and treatment hubs, all within a high concentration of construction sites.
As the threat to public health continues, one of the most important things employers can do is improve building ventilation and air circulation wherever possible. In response, construction workers across the Commonwealth focus on air quality in buildings that employ mechanical ventilation systems.
In institutions like Boston University, airflow in indoor spaces has increased, with HVAC systems running around the clock, rather than 12 to 16 hours a day. New filters capable of capturing airborne viruses are being installed in those systems that recirculate air. The so-called ‘green HVAC’ technology not only supports public health but allows buildings to be more energy efficient.
One industry that appeared impervious during last year’s uncertainty was the Massachusetts life science sector, as vacancy rates hovered slightly above zero, and rents remained at peak levels. And recent news that Alexandria Real Estate Equities has purchased Fenway’s Landmark Center in a $1.52 billion deal underscores the competitive pace for life science companies in the world’s biotech capital.
We anticipate that growth will continue in the months ahead. According to the Massachusetts Biotechnology Council (MassBio) State of Possible 2025 Report, short-term opportunities include expanding the R&D footprint beyond the current concentration on oncology and rare diseases. This expansion reaffirms Massachusetts’ status as a center for the convergence of biotechnology, medical technology, digital health applications, continued commercialization and manufacturing of therapies, extends the existing cluster and creates additional clusters outside Cambridge and Boston.
Meanwhile, Massachusetts state lawmakers recently passed legislation that would overhaul the Commonwealth’s climate laws, reducing greenhouse gas emissions while also creating renewable energy jobs. In addition to establishing requirements for purchasing offshore wind energy, the bill requires emission reduction goals for MassSave, the state’s energy efficiency program, setting a net-zero greenhouse gas emission limit by 2050.
Perhaps most pertinent to the regional construction industry, buildings are one of the biggest sources of greenhouse gas emissions in Massachusetts. This bill allows municipalities to determine how the construction of climate-friendly buildings must accelerate, allowing cities and towns to set stricter building emissions standards than the state. Though Governor Baker has opted to veto the current version of this legislation, 2021 will surely ramp up energy efficiency efforts and advance highly efficient building codes across the state.
Today, many unknowns will affect the Greater Boston construction landscape, specifically the timing around a vaccine. However, despite halting public meetings as the pandemic raged last year, the Boston Planning and Development Agency nevertheless signed off on $8.5 billion in development.
Challenges will undoubtedly persist in the coming months, but we remain optimistic about the path ahead. By monitoring a few of these industry and economic trends, we anticipate yet another successful year for our company and the region alike.