Demand Outpaces Big Box Construction

This 423,672-square-foot speculative facility was recently completed by developer The Opus Group at 10 Falcon Court in Streamwood, IL, pushing the Northwest Suburbs’ vacancy rate to 37.7% due to that market’s small size.

CHICAGO—Industrial developers in the Chicago area completed four big box developments during the fourth quarter, adding a total of 1.7 million square feet of space to this sector, according to a new report from Colliers International. The company defines big boxes as precast buildings with more than 300,000 square feet of space and ceiling heights of at least 28’. But even though developers completed an another 12 of these buildings in the first three quarters of the year, users looking for this type of space still find it challenging.

“The leasing has outpaced the new construction and we are playing catch-up,” Charles Canale, senior vice president of Colliers, tells GlobeSt.com. The Chicago big box inventory base now consists of 274 facilities totaling 153.3 million square feet, and its leasing activity totaled 3.5 million square feet during the fourth quarter, a 45.6% increase over the third quarter’s tally of 2.4 million square feet, Colliers found. And the total big box leasing volume for 2015 was 13.7 million square feet, a 38.8% increase over the total for 2014. Since the end of last year the vacancy rate sank from 10.29% to 8.44%.