While pricing has stabilized in Chicago, volume is down from last year and sales activity is heavily driven by local investors, according to Bisnow's exclusive CoStar data. There have been 34 institutional investment grade sales, year-to-date, compared to 54 last year and the 120 that is typical of the market. The price per SF is clearly up from last year’s low $100s, though the record-setting $655M acquisition ($503/SF) of the recently completed 300 N. LaSalle by KBS earlier this year distorted the average weighted pricing. 2010 has been a tale of two markets. Nearly 80% of the deals closed this year have been non-institutional grade. Counter to everyone’s expectation at the beginning of the year, distressed or foreclosure sales haven’t flooded the market though they did increase from nearly 10% of the market in 2009 to 20%. Institutional properties that have traded thus far have, for the most part, have been purchased by local investors willing to pay a premium for ultra-safe investments. |
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