Middle Market Digest: This Week in the Midwest

This week Colliers International put out some interesting numbers on the Chicago region’s industrial market. With so many developers launching spec projects, some had started to question whether all this new space was getting absorbed. And Colliers discovered that of the 25.1 million square feet of speculative space completed here since 2013, about 34% remains vacant. Some might say that is a cause for concern, but researchers say that figure has been declining for several years. And what they say they will be watching is whether that number starts to creep up in the next year or two as millions of additional spec space hits the market. If it does not, it’s a sign that the tenants are there, and developers can have confidence that their buildings will eventually get filled. Chicago may be in the situation Indianapolis found itself not long ago. After a historic burst of speculative construction in that hot distribution market, leasing slowed down for a bit, and some wondered if the region was overbuilt. But after a pause in 2015, tenants largely sorted out which of the new buildings were best-suited for their operations, and leased much of that vacant space in the latter part of the year and in 2016.—Brian J. Rogal   

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