Chicago industrial market report
Q3 2025
Chicago’s industrial market remains resilient, with leasing activity on track to exceed last year’s total. Although construction activity has declined 55% since Q3 2023, 12.9 msf are still underway, with an uptick in speculative development, indicating cautious optimism among developers. A measured pullback in development activity in 2023 helped prevent overbuilding and supported market stability. Overall vacancy remains healthy, recorded at 6.2% at the end of Q3 2025.
New construction
Construction activity has slowed significantly from its peak, with 12.9 msf currently underway. Of that, 52% is being built on a speculative basis, reflecting developers’ cautious but continued appetite for risk within the market. Notably, there is currently no development activity in the mid-range bulk segment between 500,000 sf to 749,000 sf.
Vacancy
Overall vacancy was recorded at 6.2% at the end of Q3 2025 and remains on solid footing. Small bay properties continue to post the lowest vacancy rates, while big-box inventory over 500,000 sf saw the largest decline in vacancy from the prior quarter.
Leasing activity
Leasing activity has reached 35.9 msf through Q3 2025 and is on pace to meet or exceed the nearly 45 msf figure posted in 2024. Chicago continues to serve as a key hub for industrial users, attracting large-scale commitments from tenants seeking access to a dense consumer base and labor force.
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