Chicago CBD office market report
Q4 2025
Chicago’s CBD showed mixed signals in FY 2025. Despite a slow Q4, leasing activity reached 8.4 million square feet (msf), matching the strongest year since the pandemic. Negative net absorption continues but shows second-tier class A product anchoring -1.6 msf alone. With job growth accelerating and high-utilization submarkets keeping pace with national averages, signs point to a potential rebound in office demand in 2026.
Total leasing activity in FY 2025
Chicago CBD office leasing activity saw just over 8.4 msf for the first time since 2022 and is up 3% YoY from 2024. Additionally, FY 2025 activity fell just 30k sf short of a post-pandemic high and continued a stable trend of meeting 8 msf total activity. Notable Q4 leasing activity includes USG resigning for 165k sf at 550 W Adams, AAR signing 90k sf at the Merch Mart, and Boeing taking a sale/leaseback at 100 N Riverside for 70k sf.
Net absorption in FY 2025
Chicago’s CBD has seen cumulative negative absorption each year since 2020. The CBD recorded -2.1 msf of net absorption in 2025, -400k sf of which occurred in Q4 alone. While this is a consistent negative result, Q2 2025 contributed 70% of 2025’s total at -1.4 msf. While negative absorption persists, Trophy product continues to render positive contributions. Chicago displays a tale of two qualities, as bifurcation has yet to subside among asset classes.
Change in average lease size from 2024
The average transaction size in Chicago’s CBD has contracted by 3% from 2024 to 31k sf. Additionally, Trophy and Class A lease sizes saw a 9% reduction in the same time frame while Class B and C product saw a 16% increase in size. This sizing is a continuation of post-pandemic trends, with total average lease sizing down 12% from 2020, consistent of Trophy/Class A down 25% and Class B/C up 7%.
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