Chicago industrial market report

Q4 2022

Overall, the Chicago industrial market is still strong; however, there may be a softening in the market in 2023 as companies continue to navigate the aftermath of COVID-19 and monitor supply chain concerns. Net absorption will start to decline in the new year due to the slowdown of leasing volume, a true cause and effect of the two market fundaments. Vacancy decreased to 4.0%, a record low for the Chicago market, even with 28.9 msf of new inventory added throughout 2022, further underscoring the overall strength of the market. Fourteen of the twenty submarkets across Chicago remain below 5% vacancy, a strong indicator of the robust demand across the market.
4%

Vacancy

Vacancy has reached an all-time low of 4% at the end of 2022, with record-breaking construction activity, highlighting the overall health of the market.
28.9 msf

New development

Delivered to the Chicago market in 2022 with the majority of new development happening within the I-80 corridor, Southern WI and South I-55 corridor submarkets.
38.9

Net absorption

Net absorption reached an all-time high of 38.9 msf in 2022 and continues to push vacancy to an all time low.
14.8 msf

Demand

Demand has continued to drive big box development with 14.8 msf currently under construction of projects over 750,000 sf.
$6.97/nnn

Rental rates

Rental rates have remained stable although may start to trend down from the current year-over-year increase of 7.5%.
16% increase

Sublease availabilities

Sublease availabilities increased 16% from the prior year as some companies overextended themselves during the pandemic due to high demand.
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