Strong Local Economy Fuels Industrial Market

CHICAGO-Sales and lease transactions in metropolitan Chicago’s industrial market totaled 4.9 million-sf, according to a CB Richard Ellis report. At this rate, gross total absorption for the year 2000 now totals 20 million sf. According to Patrick McCourt, a SVP with CB Richard Ellis, “With a strong finish, we could see absorption in excess of 30 million sf for the seventh consecutive year.”

The Chicago area’s industrial market is one of the nation’s largest with a property base estimated to be over 900 million sf. Distribution and manufacturing uses claim the largest shares of this total. The Chicago metropolitan area remains one of the fastest growing regions in the country. The area’s central location and its efficient transportation routes add to its attractiveness, according to the Studley Report. Year-to-date, about 42,400 new jobs have been added to the Chicago market. A tight labor market potentially could slow future growth.

At this point, increased production equals increased demand for warehouse space. There was a time when buildings and leases totaling 200,000 sf to 300,000 sf were considered major deals. Now, leases of 300,000 sf and larger have become more commonplace.