Chicago Fourth in Nation for Fastest-Growing Office Occupancy Costs, Top 15 in the World, According to CBRE

Chicago (downtown) ranked in the top 50 for prime office occupancy costs in the world, and, came in fourth for the largest 12-month increase in the nation, according to CBRE Research’s latest annual Global Prime Office Occupancy Costs report.

With the strength of a very active downtown office leasing market, Chicago has become more expensive, as it saw a 10.2 percent prime occupancy cost increase over a 12-month period as of Q1 2017, making it the fourth-fastest growing in the US, eleventh fastest in the world, and, placing it 48th on the top 50 list in the world for overall costs.

In March, CBRE noted in its Global Prime Office Rents survey that prime net rents in Chicago’s top office properties, a subset that comprises approximately 14 million square feet, rose 19.9 percent from 2015 to 2016.

This latest survey once again demonstrates strong price growth in the Chicago market by tracking prime office occupancy costs for the same properties—which reflect prime net rents, plus local taxes and service charges—for the 12-month period of Q1 2016-Q12017.

“The downtown market has been very active the last few years,” said Sara Spicklemire, senior vice president with CBRE. “Demand is still very healthy for high-quality space and we continue to see positive absorption. As long as a flight-to-quality and inbound migration to the urban core continues, I don’t see this trend reversing.

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Market Spotlight: Illinois Medical District

Poised for growth, the Illinois Medical District has more than $1 billion of planned construction projects.

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Infographic: What Do the Annual Top 100 Industrial Transactions Tell Us About the Chicagoland Market

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As Retail Anchor Space in Chicago Hits a New High, Rents Climb

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Available retail anchor space in the Chicago area is at a record high, according to CBRE’s 2017 Retail Anchor Report.

Yet as more space is available, much of the new space hitting the market is quality Class A space, which has attracted users at a faster rate than past years, and, driven rental rates up as active and expanding retailers vie for prime space in the market.

Joe Parrott, CRX, CLS, senior vice president with CBRE and author of the report, recently spoke to the Chicago Tribune about these trends.

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Blackstone and Equity Office’s $500M Willis Tower Transformation cements commitment to Retail Construction and Chicago

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Retail in Chicago, especially high-street retail, has performed very well in recent years. While rents have increased steadily, major new retail construction in the central business district has been limited. 

That is all changing with a massive $500 million investment made by The Blackstone Group and Equity Office at the iconic Willis Tower. This is the largest investment Blackstone has ever made to reimagine one of its properties. 

The total investment will transform and reconfigure 460,000 square feet of existing space within the Tower, adding 300,000 square feet of best in class new retail, dining and entertainment space to the building’s base. Continue reading

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Condo Deconversions Heat Up in Chicago

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Clark Place, a 133-unit property at 2625 N. Clark St., closed in December as Chicago’s largest condo deconversion sale to date. 

As the rental market continues to perform well in Chicago, investors and owners are looking for alternative ways to enter the market and the latest answer has been condo deconversions. 

Already, Chicago has seen several marquee deals, with the largest transaction of this type closing last December at the 133-unit Clark Place

Sam Haddadin, who recently joined CBRE as a condo deconversion specialist, sees many more opportunities on the horizon, as investors are actively targeting condo associations in desirable locations that could benefit from a deconversion transaction. Continue reading

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CBRE Extends Partnership with World Champion Chicago Cubs

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CBRE has extended its partnership with the World Champion Chicago Cubs for the 2017 season and will once again host the annual CBRE Charity Bash at Wrigley Field this July, with numerous Cubs players and celebrities attending.

CBRE will also continue promoting its brand with digital signage inside the Friendly Confines at all 81 regular season home games plus the postseason, and will again host a number of additional unique, behind-the-scenes events and experiences for CBRE employees, clients and partners at the historic ballpark.

“Our partnership with the Cubs was an absolute home run last year,” said Jim Carris, senior managing director of CBRE in Chicago. “Coming together with the Cubs during their incredible championship season provided a tremendous lift to our brand and created countless memories that our people, our clients and our partners will carry with them for a lifetime. We’re looking forward to another exciting season.”

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