The RENT blog gives you the resources and tools you need to make the best decisions regarding your real estate needs. We cover a broad range of subjects regarding office space, tenant needs and what to look for when investing in property.
Writing with an update on the local office market in Chicagoland.
Social distancing measures have resulted in a dramatic downshift in office leasing, sales, and development activity. Average office vacancy should temporarily increase by 1% due to lower demand and unfortunately timed development projects. That said, average vacancy in 2020 should remain under 13% for the year the seventh year in a row. Average rents in 2020 should decrease by 3% before recovering in 2021 or early 2022.
Even before the Corona virus, office sales were already got off to a sluggish start in 2020. Total sales volume for the last twelve months fell to $3 billion for the first time since 2011, due to a pullback in the Class A downtown submarket. This submarket’s decline is the result of record-high pricing and uncertainty regarding local real estate taxes. The economic downturn will further depress sales volume and prices across all Chicagoland submarkets.
Stay healthy and safe.
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September 10, 2020
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