Worcester: Multifamily Investing for the Long Term

As multifamily real estate investors, we are often asked why we like investing in Worcester, Massachusetts and particularly why we think it is an increasingly promising market for long-term investment opportunities. There are several factors that make Worcester an attractive location for real estate investment, including an exploding number of biotech labs, a hub of colleges and universities, an area showing strong population growth, a thriving culinary scene all in area where housing and office space is nearly 50% cheaper than Boston, yet only 75 minutes away.

Worcester is quickly becoming a hub for biotech labs, with several major companies establishing a presence in the area. Biotech companies require specialized facilities, and Worcester has the necessary infrastructure and resources to accommodate them. This has led to a surge in demand for commercial real estate in the area. The Massachusetts Biotechnology Council, or MassBio, reported in its 2022 industry snapshot that Worcester County experienced 20% growth in biomanufacturing jobs and research and development jobs between 2020 and 2021, with an average salary of $122,873. Additionally, lab space costs between $31 to $45 per square foot versus over $100 in the Greater Boston area.

In addition to biotech labs, Worcester is home to 8 colleges and universities, including Worcester Polytechnic Institute, Clark University, and Holy Cross. These institutions bring in 35,000 students alone, plus faculty members each year, creating a significant and reliable demand for the local area.

Worcester is also experiencing population growth, with more people moving into the area every year. According to the U.S. Census Bureau, Worcester added 25,000 new residents over the past 10 years, yet housing supply only increased by 10,000 total units, driving up housing costs across the board and with the population continuing to grow about 1% annually, this will continue to put further strain on the existing, limited housing supply.

Finally, Worcester has a vibrant culinary scene. “One brilliant example of this can be found on Shrewsbury Street’s ‘Restaurant Row’ in the heart of the city. This geographical hot spot features over 40 different eateries within walking distance, so there’s literally something to satisfy every palate” writes Kelly Rogers. This has led to increased demand for retail space and commercial real estate, creating new investment opportunities for real estate investors.

The Broadleaf team sees Worcester as an attractive destination for young professionals and families and with limited housing supply, steady population growth, a vibrant culinary scene, we will continue to investing in multifamily in this area.