Chi-150-North-Riverside Chicago’s 150 N. Riverside will be the largest building delivered next year.

CHICAGO—Big changes are on the way in Chicago’s downtown office market, and some signs of that may have become visible in the second quarter. For the first time in more than a year, the overall availability rate increased, jumping 50 bps from 14. 7% to 15.2%, according to Savills Studley, which just published a research report on activity in the CBD. The firm attributes the increase to the new class A space underway in the West Loop and Fulton Market area. And activity is very likely to increase, as the three office towers nearing completion are already about 70% pre-leased, and this should spur developers to launch additional projects in the hot submarkets.

Furthermore, rents have also started to surge. In the second quarter, overall asking rents in the CBD increased from $36.37 to $37.45, a jump of 3.0%. Class A properties were disproportionately responsible for that increase, and went from $40.24 to $41.87, an increase of 4.0%. Savills Studley points out that landlords of the newest trophy buildings in the West Loop have rented those spaces for more than $50.00, sometimes for considerably more, further boosting the overall average.      

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Brian J. Rogal

Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.

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