Chicago office tenant tours spiked in August. Was it a blip?

Early indicator of leasing activity showed most interest in West Loop, Fulton Market areas

Chicago /
Sep.September 30, 2021 03:23 PM

(iStock, Illustration by Kevin Cifuentes for The Real Deal)

One early indicator of leasing activity shows tenant interest rising in the Chicago office market despite a vacancy rate that climbed to a record high this year.

The monthly VTS Office Demand Index for Chicago jumped 28 percent from July to August, and is now higher than its pre-pandemic average. The West Loop and Fulton Market — where firms have signed several leases recently — led the increase, according to the report.

Interest was the highest it has been since before the pandemic outbreak in March 2020, VTS’ August index showed.

The report tracks unique tenant tours, both in-person and virtual, of office properties in the seven core U.S. markets that include — in addition to Chicago — Boston, New York, Los Angeles, San Francisco, Seattle and Washington, D.C. Seattle was the only other city that showed rising number of tours in August, according to the report.

Chicago’s August spike, however, may have been a blip, said VTS’ Ryan Masiello.

“The recent volatility is driven by a number of large tenants entering the market over the past few months, something we don’t expect to repeat itself moving forward in the near term,” he said.

Chicago’s downtown office market vacancy rate rose to 19.4 percent in the second quarter as companies continued to shed space, exit deals entirely or cancel planned leases. While Fulton Market’s vacancy rate was the highest of any neighborhood in the city, developers are still proposing projects and tenants are inking more deals.

Snapchat’s parent company is planning to double its existing office space in River North with a move to Jeff Shapack and Focus’ 167 North Greet Street. Logistics provider MoLo Solutions is also looking to triple its office space at the same building. The landlords have faced challenges, however. In July 2020, software provider CCC Information cut its space at the massive development to 125,000 square feet, from 180,000.





    Related Articles

    arrow_forward_ios
    525-613 Roosevelt Road in Glen Ellyn
    Suburban Chicago shopping center sold in potential sign of retail rebound
    Suburban Chicago shopping center sold in potential sign of retail rebound
    Kimpton Hotel Monaco at 225 North Wabash Avenue and Xenia Hotels & Resorts' Marcel Verbaas (Google Maps, Xenia)
    Kimpton Chicago hotel to be sold for $20M less than appraised value eight years ago
    Kimpton Chicago hotel to be sold for $20M less than appraised value eight years ago
    Photo Illustration of construction materials on an airport runway (Getty)
    British Airways files negligence suit against Chicago over O’Hare expansion
    British Airways files negligence suit against Chicago over O’Hare expansion
    AmTrust Realty to pump in $100M to spruce up Loop portfolio
    AmTrust Realty to pump in $100M to spruce up Loop portfolio
    AmTrust Realty to pump in $100M to spruce up Loop portfolio
    Angelo Gordon sells North Side retail assets for $46.3M
    Angelo Gordon sells North Side retail assets for $46.3M
    Angelo Gordon sells North Side retail assets for $46.3M
    Chicago’s Old Post Office nabs health care firm as new tenant
    Chicago’s Old Post Office nabs health care firm as new tenant
    Chicago’s Old Post Office nabs health care firm as new tenant
    Buckhorn Estates in Des Plaines (Google Maps)
    Denver firm buys two suburban Chicago mobile home parks for $43M
    Denver firm buys two suburban Chicago mobile home parks for $43M
    The WGN-TV building and Hines CEO Jeffrey Hines (WGN-TV, Hines)
    Hines pays about $31M for WGN-TV studio
    Hines pays about $31M for WGN-TV studio
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...