Direct vacancy levels in the MB Real Estate (MBRE) Index, which is comprised of the Chicago Business District’s (CBD) 30 newest buildings, dropped slightly to 9.9 percent from 10.0 percent in the last quarter. During the same period, the overall CBD direct vacancy rate dropped 20 basis points to 14.5 percent.
The direct vacancy rates in both the MBRE Index and the overall CBD have finally gone below the 2009 equivalent rates for the first time in four years. This indicates that the office market’s gradual improvement coincides with the recovering economy. The direct vacancy rate spread decreased slightly as well from September to December which indicates demand for Class B and C buildings is catching up with the newest product. Since the overall CBD direct vacancy rate has steadily declined since June 2012, and the MBRE index direct vacancy rate only began its decline in December 2012, it is clear that demand has stabilized in MBRE Index buildings.
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