CHICAGO—Over the next year or so, landlords and developers in Chicago's downtown office market will play very close attention to the amount of new space absorbed by users. Several class A towers were recently opened, and if all that space gets quickly absorbed, it will almost certainly help push developers to launch additional projects that will transform the city's skyline.
So far, the prospects for new development look promising. The overall vacancy rate in the market did tick up to 17.3% in the first quarter, an increase of 30 bps, according to a new market study by Newmark Grubb Knight Frank. But that boost was largely due to the delivery of 150 North Riverside during the quarter, and 444 W. Lake St. in the previous one, which added 2.4 million square feet of space to the inventory.
But demand for such trophy spaces has been strong. In the first quarter, users absorbed another 544,000 square feet of class A space. And companies from a diverse cross-section of industries continue to see the CBD as a desirable location.
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Brian J. Rogal
Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.
