CHICAGO-Office vacancy rates hit an 18-year low in Chicago’s Downtown business district in the third quarter, while suburban vacancy rates rose following a torrid first half leasing pace, according to a CB Richard Ellis report.
Downtown vacancy rates fell to 8% from 8.3% in the second quarter as the net amount of spaced leased hit 638,463-sf compared to 102,079-sf in the same period last year. Net absorption so far this year is 2.6 million-sf compared to 839,756 million-sf in the first nine months of 1999. Telecom and internet infrastructure industries are leading the way according to the report.
The suburban vacancy rate climbed to 9.8% from 9.6% in the second quarter. A year ago, the suburban vacancy rate was 10.4%. The net amount of spaced leased fell sharply to 147,772-sf from the five-year third quarter average of 515,111 sf. Suburban net absorption for the year is running at a 10-year high of $3.5 million-sf, however, reflecting the blistering pace of leasing activity in the first half. During the quarter, seven new speculative office buildings opened in the suburbs, adding 627,931-sf of new space to the market.