According to a report by the real estate firm Studley, Chicago’s downtown office lease transactions are only about one-half of what its historical long term average has been. Completed office space transactions reached 1.1 million square feet in the 2nd quarter and 7.2 million over the past 12 months leaving the Class A vacancy rate in the Chicago CBD at 18.5%. With a market size of 120 million square feet of office space in the Chicago, Downtown area, this transaction rate is close to a complete stall.
Tenants are still slow to make decisions and transactions are taking longer to complete. There are a number of larger tenants in the market now who will have to make a decision within the next several months as to what to do with their expiring office leases. The gap between landlord and tenant expectations are narrowing and deals are becoming easier to make. As the economy picks up, these tenants will be making decisions and hopefully Chicago Office Space will see some better activity.Chicago Office Space , Office Space , Office Space Negotiations