CHICAGO—Leasing activity for the Chicago industrial market totaled a little more than 3.5 million square feet in the first quarter of 2017, 37.9% less than the total in the first quarter of 2016, according to a new market update from Cushman & Wakefield. Most observers, however, believe the slowdown is just a pause in transaction activity, and the market still has a healthy number of tenants actively looking for space.

“There are several million square feet of active tenant searches in the market, demand is steady and we expect leasing volume to rebound the remainder of the year,” Jason West, executive managing director of brokerage services at Cushman & Wakefield Chicago, tells GlobeSt.com. As to what caused the slowdown, that is “hard to pinpoint, but given the high leasing volume in 2016 we believe the first quarter activity was just a temporary hangover from last year.”

“Market fundamentals are still good, capital is flowing into industrial real estate and there is continued demand for both distribution and manufacturing facilities,” he adds. Leasing activity was strongest in the I-80 Corridor submarket for the third consecutive quarter, the data show, with nearly 800,000 square feet. Inventory Liquidators Corp. and CTDI signed two of the largest leases, for about 531,000 square feet at 8999 Palmer Dr. in River Grove, and 501,000 square feet at 3900 Brandon Rd. in Joliet, respectively.