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Tenants Maintain Grip on 'Dismal' CBD Office Market

CHICAGO-"The chances of an office recovery in the near future for the Chicago CBD market is dismal," according to US Equities Realty. The market needs one million sf of net absorption over six years to reach the vacancy levels seen in the last decade.

By Mark Ruda | Updated on January 31, 2006

CHICAGO-Tenants continue to hold the cards in Downtown office space negotiations. With vacancy including sublease space at 19.1% by one measure, the question is how much longer tenants will enjoy their advantage.

CB Richard Ellis senior vice president Lisa Konieczka agrees tenants continue looking to take advantage of current market conditions, but sees rays of hope for some building owners. “The first half of 2006 will see positive improvement with several firms occupying space including Blue Cross Blue Shield and CDW, which will give a much need boost to the East and West Loops,” she notes.

However, Equis Corp. points to two new buildings planned for River North, following two West Loop and one Central Loop completions. “With proposed new projects at 300 N. LaSalle St. and 351 N. Clark St., the question is how many more buildings the Downtown market can support given current demand levels,” Equis Corp. says in its market report.

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