CHICAGO-New construction is helping nudge the industrial vacancy rate upward, according to a recent report by CB Richard Ellis. The firm pegs the second-quarter vacancy rate across the 1-billion-sf industrial market at 9.4%, up 20 basis points from the first quarter.

The market has added more than 1.3 million sf of recently-built space, according to CB Richard Ellis. “There is some concern that an increase in supply, both new construction and sublease space, could impact the market over the next several quarters,” says senior vice president Bill Frain. “Ultimately, a return to stronger levels of leasing, and lower vacancy rates, will hinge upon sustainability of growth within the manufacturing sector.”

CB Richard Ellis tracked 8.4 million sf of lease deals during the second quarter, which represents a decline, with 2.4 million sf being written in the O’Hare submarket. Meanwhile, the South Side of Chicago has been the busiest submarket in terms of sales with 1.4 million sf changing hands, followed by the North Side, O’Hare area and Near West suburbs.

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