Fulton Market defies all-time highs for Chicago office vacancies

Area was only pocket in city where availability rates dropped in 2021

Fulton Market (Google Maps, iStock)
Fulton Market (Google Maps, iStock)

Fulton Market, a magnet for tech and life science companies, was the city’s only neighborhood where office availabilities dropped last year.

Class A availabilities dropped 1.2 percent to 23.1 percent in 2021, compared with an increase of 4.9 percent to 29.7 percent in the Central Loop, the city’s highest.

For the city as a whole, vacancies rose about 3 percent to 16.1 percent, according to Avison Young’s latest office report. Some 8 million square feet was leased last year, up from 6.6 million in 2020, though still well below pre-Covid averages of 11.3 million.

“The Fulton Market hot streak is likely to continue in 2022 with more office space, lab space and numerous retail and entertainment options set to open doors over the next year,” the report said. “New supply will continue to challenge older buildings that are already struggling.”

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The numbers show a split Chicago office market. Tenants leasing renovated and newer buildings while ditching older properties during the pandemic.

Strong demand in Fulton Market pushed up the average sale price per square foot to $678 last year, compared with the central business district’s $431.

A building at 226 North Morgan Street in Fulton Market sold for a Chicago record of $1,090 per square foot last year, the report said. About 20 percent of the 12,840-square-foot building is available for lease, according to a marketing brochure on Stream Realty’s website.

Of the 12.4 million square feet of office projects that are proposed and under construction, three million square feet of amenity-rich buildings will be delivered this year.