Chicago office rents rose slightly in 2017 while concessions jumped: report

Chicago was near the top for tenant improvement allowances nationally, Savills Studley found

TRD CHICAGO /
Apr.April 30, 2018 01:00 PM

Chicago skyline (Credit: Max Pixel, Public Domain Images)

Office rents in Chicago climbed slightly in 2017 but tenants effectively paid less than they did in 2016 thanks to landlord concessions, according to a new report by tenant representation brokerage Savills Studley.

Negotiated rents in Chicago were up by 0.3 percent year over year, according to the report. The jump in 2016 was 0.6 percent.

But handouts from landlords in the form of tenant-improvement allowances jumped 6.6 percent last year, which helped lower effective rent by 2.6 percent.

Chicago was near the top on tenant-improvement allowances nationally, but markets such as Washington D.C, Denver and Lower Manhattan each saw increases in the concessions last year that amounted to more than double Chicago’s.

According to the report, Atlanta, Seattle and Austin saw the largest gain in effective rents last year, while markets in and around New York City like Midtown Manhattan, Northern New Jersey and Downtown Manhattan took the largest hit on effective rents.

Gross office rents in Chicago, meanwhile, reached an average of $50.49 per square foot last year, according to the report, 20 percent above their pre-recession peak in 2007 of $41.99.


Related Articles

arrow_forward_ios
1111 West 22nd Street and Fairbridge Properties managing partner Dmitry Gordeev (Credit: LoopNet and Fairbridge)

NJ investment firm scoops up office complex near former McDonald’s HQ

Gogo shedding 86K sf in West Loop HQ in cost-cutting purge

Gogo shedding 86K sf in West Loop HQ in cost-cutting purge

Medical IT company moving headquarters to O’Hare office market with new lease

Medical IT company moving headquarters to O’Hare office market with new lease

Surge in private-sector jobs helps fuel Downtown office market

Surge in private-sector jobs helps fuel Downtown office market

Office leasing cools, rents slide Downtown and in the suburbs during Q3: report

Office leasing cools, rents slide Downtown and in the suburbs during Q3: report

Downtown office market slows in Q1: report

Downtown office market slows in Q1: report

Blackstone lists office complex near O’Hare for $75M

Blackstone lists office complex near O’Hare for $75M

BOMA’s new measurement standards: Who wins, and who loses?

BOMA’s new measurement standards: Who wins, and who loses?

arrow_forward_ios