Asking net lease rates for warehouse and distribution space held at $4.28 per sf, general industrial space commanded $4.65 per sf while research and development space is steady at $8.49 per sf. However, Grubb & Ellis reports softness in the city and Cook County suburbs, as property owners discount their asking lease rates to compete against newer properties in the collar counties, where property taxes also are lower.
Owners in the city also have problems selling properties, Grubb & Ellis' report indicates. "There is a large selection of purchase opportunities for buyers and tenants due to a huge supply of product," according to the report. "The problem is that the product available often does not match the usage requirements of the tenant. Also, sellers are overpricing functionally obsolete buildings based on low interest rates and a flood of buyers in the market."
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