CHICAGO—Suburban Chicago tenants were relatively active in the first quarter, leading to 319,986 square feet of positive absorption and a 19 bp decrease in the overall direct vacancy rate, according to a new market report from MBRE. The suburban region's rate was 21.47% by the end of the first quarter.
MBRE data show 20 suburban deals larger than 15,000 square feet were signed, for a combined total of 705,046 square feet. Perhaps more impressive the overall average direct gross asking rent for the suburbs increased by 9.7% in the past year to $22.13.
Class A properties in the East-West submarket continue to outperform all other categories in the region. The vacancy rate for this grouping declined about 130 bps to 17.6% in just one quarter, the fastest drop in the suburbs. And class A tenants there absorbed another 265,243 square feet while class A buildings in the Northwest submarket and O'Hare lost ground.
Developers remain leery of launching new projects in such a high-vacancy environment. But several developers have begun marketing office space at a handful of proposed new suburban developments. Ryan Cos., for example, wants to construct three three-story office buildings with a total of 350,000 square feet at 200 York Rd. in Oak Brook, and GlenStar Properties has proposed an 11-story tower with 300,000 square feet at 8655 W. Higgins Rd. in the O'Hare submarket.
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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.
