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Chicago’s Massive Influx of Spec Industrial Poised for Quick Absorption
Buoyed by the continued growth of e-commerce, Chicago-area industrial developers added nine million square feet of supply in the third quarter, much of it speculative. This caused a slight uptick in vacancy, but underscored the overall health of the market, according to a new report from NAI Hiffman.
The Chicago area’s overall industrial vacancy rate ticked up to 5.63% from the five-year low of 5.43% seen in Q2. This was due to 7.3 million square feet of mostly-vacant spec product coming on line during the quarter.
“While a large amount of speculative space was added to the market all at once in the third quarter, partly because of weather conditions delaying construction, we’re confident the new product will quickly be absorbed,” said Amanda Ortiz, director of research for NAI Hiffman. “Users across a variety of industries have demonstrated that they’re willing to pay a premium for Class A product.”
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