Report: Suburban Chicago Office Market Shows Resilience

Bradford Allen’s latest “CRE Pulse” report suggests the suburban Chicago office market is more resilient than it seems. According to findings, a deeper dive into the data shows that the actionable portion of the market is much more competitive than headline figures suggest.

The current vacancy rate in Chicago’s suburbs is 25%—roughly 23 million square feet sitting empty. About 17.2 million square feet of vacant space is concentrated in approximately 20% of suburban office properties. If these largely vacant properties are removed from the data, the remaining 80% of suburban offices—properties that are generally actively being marketed—have an average 10% vacancy rate. Many suburban Chicago office properties have remained healthy despite the ever-changing market conditions.

The report also cites that in today’s market transformation, size matters. For example, the vacancy rate for 1,000 to 10,000 square feet, currently the most popular size requested by tenants in the suburbs, is just 6%. Tenants strongly prefer move-in-ready spaces, with nearly 30% of square footage leased in 2023 being for move-in-ready suites, compared with 11% in 2019.

Don’t miss the Lifetime Achievement Award Presentation and Keynote Interview with G. Joseph Cosenza, Vice Chairman of The Inland Real Estate Group, LLC and President of Inland Real Estate Acquisitions, LLC at Connect Midwest: Multifamily, Affordable, Student & Senior Housing Trends on June 4, 2024, at the W-Chicago, City Center Hotel, Chicago, IL. Register Today to network with your peers!