CHICAGO—Absorption in the CBD's office market may have slowed inthe third quarter, but the year has already seen a host of newdeals and renewals, and according to MBRE, this“should result in significant amounts of positive absorption overthe next two years.”

The firm just released its analysis of the third quarter andalso found that the vacancy rate for each class of properties inthe CBD has continued to sink. The overall rate fell to 13.2%, adecline of about 30 bps since the second quarter, while class Aproperties ended the quarter at 11.9%, a decline of roughly 20 bps.A possible sign of concern was that the CBD experienced 397,334square feet of positive absorption, which makes the year-to-datetotal just 559,791 square feet, or 44% less than it was in thethird quarter of last year.

However, a “notable component of recent activity has been thethird quarter signed relocations of ConAgra,Kraft-Heinz, Motorola Solutions,and Baxalta which have continued profound impacton the urban migration narrative,” the firm said.Furthermore, with other suburban companies, includingMcDonald's, making noises about their own possiblemoves into the CBD, downtown landlords should expect further migration.

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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.