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Chicago Office Faces Uncertainty After Strong Start to 2020

Aside from suburban office, where vacancies increased 10 basis points, the Chicago office market began 2020 strong, says NKF. For instance, CBD vacancies fell 30 bps to 13.4% in the first quarter, after the Q4 2019 delivery of the Old Post Office caused an uptick.

Then things changed. “All of the strong activity the commercial real estate world has been experiencing for the past several years came to a halt at the end of the first quarter, as the novel coronavirus that causes COVID-19 arrived in the U.S.,” write NKF’s Amy Binstein and Eris Geskermann.

That being the case, Binstein and Geskermann expect “a modest recovery time” for CRE, and a tight labor market should mean only a slight increase in office vacancies. “Where we might see significant changes is in the types of office space as tenants push back even more against open floor plans and tight co-working spaces.”

Pictured: 333 N. Green St. in the Fulton Market District.

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About Paul Bubny

Paul Bubny serves as Senior Content Director for Connect Commercial Real Estate, a role to which he brings 13-plus years’ experience covering the commercial real estate industry and 30-plus years in business-to-business journalism. In this capacity, he oversees daily operations while also reporting on both local/regional markets and national trends, covering individual transactions across all property types, as well as delving into broader subject matter. He produces 15-20 daily news stories per day and works with the Connect team and clients to develop longer-form content, ranging from Q&As to thought-leadership pieces. Prior to joining Connect, Paul was Managing Editor for both Real Estate Forum and at American Lawyer Media, where he oversaw operations at both publications while also producing daily news and feature-length articles. His tenure in B2B publishing stretches back into the print era, and he has served as Editor in Chief on four national trade publications. Since 1999, Paul has volunteered as the newsletter editor of passenger rail advocacy groups (one national, one local).

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