Writing with a holiday update on the Chicagoland office market

2020 was a tenant's market: office rents declined by 2.7% in downtown Chicago, and by 1.7% in the suburbs.  Total available space increased to a record 86 million square feet.  

Average vacancy is expected to increase to 13.5%

On a brighter note, real estate stocks have surged after news of successful Covid-19 vaccine test results.  Investors, landlords, and tenants are now planning beyond the pandemic.

Most tenants will maintain a physical office but will reduce their office footprints to take advantage of the benefits of limited work-from-home.  

A 2007 meta-analysis of 46 academic studies reveals that workers see greater autonomy and lower work-life conflict when working up to 2.5 days per week at home.  

However, beyond 2.5 days per week, there were more significant harms to relationships with coworkers.  Beyond mere productivity, work-from-home poses challenges to innovation, mentoring, recruitment/retention and company culture.

Ultimately, the suburban markets may benefit from an exodus of tenants from the downtown area.  

The suburbs feature low-density, low-rise buildings better suited for social-distancing measures, and lower rents compared to downtown.  

Also the suburbs feature lower cost housing, which has become even more important as people spend more time working in their homes.

Stay healthy and safe & happy holidays!

PS – One of my buildings is offering very competitive, below market rents in the northwest suburbs.  Let me know if you're interested, or if my commercial real estate brokerage services may benefit you.

Troy Golden-President
Golden Group Real Estate

For more on Golden Group Real Estate, read about our real estate services. Let us know if we can help you find office space for rent or buildings for sale.

Call us at our office at(630) 805-2463, or email us at troy@goldengroupcre.com for information on the latest available properties.