Meanwhile, the amount of new construction has more than doubled in the past year, to nearly 10 million sf in the first quarter. Delta Associates notes 33% of the new construction is pre-leased, while 70% of the 4.7 million sf of deliveries in the first quarter had tenants lined up. However, the new inventory has nudged the vacancy rate nearly a half-point to 9.9%, according to the report. Nonetheless, rents inched up to an average $4.87 per sf.

"Rents will likely rise modestly in 2005 as demand for this product type continues to strengthen," according to Delta Associates. "With market conditions strengthening and rents edging up, this asset class will continue to provide steady returns on investment."

Sales prices were buoyed by the $56-million portfolio sale by Oak Brook-based CenterPoint Properties Trust to ING Clarion Partners, according to Delta Associates, representing a $57 per sf price. Also, WP Carey paid $61 per sf for a suburban Lake County property.

The extremes of the vacancy spectrum can be found in the 78-million-sf I-55 Corridor, according to Delta Associates. On the north end of the submarket, vacancy is just 5.3% with sublease space, lowest in the entire 903-million-sf Chicago area. On the other hand, vacancy with sublease space is 15.9% in the southern portion of the I-55 Corridor, which includes 55.4 million sf.