Chicago Behind National Average in Third Quarter
15 Oct, 2010, Chicago
Cushman & Wakefield today released third quarter 2010 statistics for the U.S. office market that show leasing activity in Chicago decreased 36.6% year-over-year, ending the third quarter at 1.1 million square feet, compared to 4.6 million square feet at the end of the third quarter of 2009.
Year-to-date leasing activity for U.S. central business districts (CBDs) totaled 45.5 million square feet at the end of the third quarter of 2010, a 31.6 percent increase in activity from the 34.6 million square feet leased at this time last year. Of the 30 CBDs tracked by Cushman & Wakefield, 18 saw year-over-year increases in leasing activity.
The rise in leasing activity led to declines in vacancy in most markets. After reaching a high of 15.0 percent at the end of first quarter of 2010, the overall U.S. CBD vacancy rate continued its decline for the second consecutive quarter, ending the third quarter at 14.7 percent, down from 14.8 percent at midyear 2010.
The overall vacancy rate for Chicago decreased to 16.5% at the end of the third quarter of 2010, down 0.1% from 16.6% at the end of the second quarter. The national average was 14.7%, down -0.09% from the end of the second quarter.
Executive Vice President Jeff Samaras said, "Compared to East and West Coast CBDs, Chicago maintains a lag-time. We're slower to increase vacancy rates as the economy fails and slower to decrease vacancy when the economy improves. Given the conservative business nature of Chicago, area employers always take a "wait and see" attitude prior to hiring new employees, exacerbating this period."
The overall rental rate for U.S. CBDs remained unchanged quarter-over-quarter. Rental rates for Chicago rose during the third quarter to $31.35 per square foot, up $0.26 from $31.09 at midyear 2010.
# # #