January 2015
Year-End Market Review & 2015 Forecast
NAI Hiffman is pleased to present its Year-End Market Review & 2015 Forecast, a detailed look at the past year in the Chicago Metropolitan industrial, office, retail, and investment real estate markets and the outlook for these markets in 2015 and beyond.
This year’s report totals 84 full-color pages detailing:
- Up-to-date market statistics
- Current trends
- Significant lease and sale transactions
- Largest blocks of available space
- Hundreds of detailed charts
- Informative maps
Industrial Vacancy Down to 7.95%, 11.5 MM SF Absorbed in 2014
Chicago’s industrial market experienced its 18th consecutive quarter of positive net absorption, as nearly 2.9 million SF of vacant space was removed from the market through leasing activity and user sales. Net absorption averaged more than 3.2 million SF per quarter during 2014, bringing the tally for the year to more than 11.9 million SF, down from last year’s 15.8 million SF absorbed during 2014. The vacancy rate dropped 44 basis points over the course of the year to 7.95%.
Suburban Office Outperforms Downtown Office Market in 2014
Over the course of 2014, the suburban office market absorbed more than 1.8 million SF of vacant space, with 589,608 SF absorbed during fourth quarter. This activity pushed the overall vacancy rate down even further to 18.56%.
The downtown office market vacancy rate decreased by 57 basis points during the past year to 11.94%, the lowest rate the downtown market has seen since 2008. Net absorption remained positive, despite large vacancies being reintroduced, absorbing only 44,375 SF of vacant space during 2014.
2014’s Retail Market Driven by Food and Furniture Stores
While Safeway’s decision to shutter the entire 72-store Dominick’s chain at the end of 2013 halted retail recovery momentum, the food store and furniture retail category fueled the majority of retail expansion within the Chicago Metropolitan area in 2014..
Office and Industrial Investment Activity Continues Improvement
Strong institutional investment in Chicago’s office and industrial markets has returned over the past few years, with investors beginning to focus on non-core assets. Total industrial investment sales volume for 2014 was about $1.6 billion, while the downtown office sales volume totaled $4.08 billion in 2014 and the suburban sales volume totaled about $1.05 billion.
For further information regarding the content of these market reviews, please contact:
Brian Chandler | Research Associate
630 317 0738
bchandler@hiffman.com
If you are interested in attending a custom market overview presentation, please contact:
John R Picchiotti | Chief Operating Officer, Brokerage
630 691 0608
jpicchiotti@hiffman.com
