CBD Vacancy Rate Pushes Past 9% In Q1
There are plenty of notable changes in MB Real Estate's Q1 market index, which measures the vacancy rate and overall health of the Class-A central business district office market.
The December arrivals of 150 North Riverside and River Point sent the index's direct vacancy rate rising 86 basis points to 9.1%. That matches the Q2 2016 rate but is still historically low; in Q3 2015 vacancy was 10.8%. River Point is 83.3% leased with its anchor tenants McDermott, Will & Emery and DLA Piper leading the way, while 150 North Riverside is 81.1% leased. Its largest tenants will be Hyatt Hotels and William Blair & Co.
The rise in the vacancy rate was expected. The arrivals of 150 North Riverside and River Point, along with the 2018 delivery of CNA's new HQ at 151 North Franklin, are expected to add 4.4M SF of new inventory to the CBD by next year. River Point and 150 North Riverside replace 227 West Adams and the Leo Burnett Building on the MBRE index.