Chicago Industrial Real Estate Market Reports | Avison Young US - Chicago

Chicago industrial market report

Q2 2022

The Chicago industrial market continued to exhibit strong market fundamentals throughout the second quarter of 2022 illustrated by record low vacancy, robust net absorption and a very healthy development pipeline. Historically low vacancies have allowed landlords to push rental rates to new heights, increasing 10% from the prior year, as demand continues across the Chicago market.

4.2%

Unemployment

The Chicago unemployment rate decreased to 4.2% as of May 2022, compared to 6.5% a year ago.

4.4%

Vacancy

Overall vacancy remains extremely low, recorded at 4.4% at the end of the second quarter, a decrease of 140 basis points from the year prior.

8.1 msf

Delivery

A total of 8.1 msf of inventory has delivered to the market during the second quarter of 2022, totaling 14.7 msf year-to-date, leaving only 5.7 msf currently available or 38.8%.

+9.3%

Absorption

Demand in the second quarter of 2022 exceeded the prior quarter’s pace, up 9.3% to 10.5 msf of positive net absorption.

+10%

Rental rate growth

As vacancy remains very tight, landlords have benefited from increased rental rates, approximately 10% higher than the prior year prior and are offering short-term leases due to inflation concerns.

↓

Leasing activity

Overall leasing activity decreased during the second quarter of 2022, attributed to economic uncertainty and companies taking time to evaluate true needs.

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