Downtown Office Vacancy Peak Seen in Report

CHICAGO-The tide may be turning, though ever so slowly, for the Downtown office market, according to a report by Grubb & Ellis Co. The real estate services firm pegs the Downtown vacancy rate at 13.3%, down from 14% at the beginning of the second quarter.

“Preliminary data seems to indicate that the Chicago office market is finally beginning to stabilize with respect to sublease space being absorbed and a slight increase in leasing activity reported for the quarter,” says research manager Alan Bohannon in a statement. “In addition, for the first time in over a year, we’re seeing the overall vacancy rates beginning a slight downward trend.”

Sublease space on the market increased by 23,000 sf to just over 6.1 million sf, according to Grubb & Ellis. Overall, the Downtown market saw positive absorption of 900,000 sf led by the West Loop, with more than half of that result. In the first quarter, the West Loop saw negative net absorption of 239,000 sf.