MB Real Estate has released the 2nd Quarter 2012 Chicago Market Overview, a quarterly report that tracks trends, analyzes data, and provides you with our forecast for the Chicago CBD and Suburban office markets.
- Occupancy increased by 105,000 square feet. Improved demand for Class A and B buildings was muted by weakened demand for Class C.
- Direct vacancy fell 10 basis points to 15.7 percent. Google is in advanced negotiations to bring a 500,000 square foot new requirement to the CBD.
- At the end of this year, Hines plans to break ground on a 45-story, 900,000 sq. ft tower at 444 West Lake.
- A slow recovery is expected as new job announcements compete against tenants eliminating underutilized space.
- Occupancy increased by 509,000 square feet as each submarket experienced positive net absorption.
- Direct vacancy fell 50 basis points, but remained at a significantly high 23.0 percent.
- Class A asking rental rates are down 3.1 percent, which has likely contributed to positive net absorption.
- Speculative construction is, and will remain, at a standstill.
- Vacancy is expected to remain elevated as the suburbs lack the demand drivers seen in the CBD.
In addition to the Chicago Market Overview, please reference our 2nd Quarter 2012 Submarket Snapshots, which include highlights and analysis of each of the Chicago submarkets that MB Real Estate tracks.