CHICAGO OFFICE: SLOW AND STEADY
Want to get a jump-start on upcoming deals? Meet the major Chicago players at one of our upcoming events!
|Employment in Chicago tends to grow organically, says Marcus & Millichap's Howard Wiese, and that's why we're not getting the pop in office occupancy growth that some other markets are getting. (Makes sense, but tell it to our ego.) Chicago dropped from the No. 9 to the No. 13 fastest-growing office market, according to M&M. The city lost nearly 400,000 jobs during the recession and has gained just 52,000 back in the last year. Even that small level of job growth will decrease vacancy, although 2011 will mostly be spent backfilling old spaces, Howard tells us.|
|What's interesting about this recovery cycle is that four different developers have potential buildings that they're looking to get out of the ground. With 301 S Wacker (rendered above), 550 W Adams,RiverPoint, and a potential John Buck site on the table, whichever can get more than 50% pre-leasing from a major tenant may be the first to pop up, but that could take another 12 to 18 months, Howard tells us. He expects leasing to pick up again as employers gain confidence that they'll continue to hire or stay the same size. (Until then, buildings will continue to made of pixels instead of steel.)|