Join CBRE and a host of Cubs celebrities for a night of fun and a great cause at Wrigley Field. Last year’s event raised more than $500,000 for CBRE Cares and Cubs charities. See you there!
CBRE Rent Analysis Lists Chicago As One of the Best Positioned Markets for Future Warehouse Development
According to a new report from CBRE, projected rents are more than adequate in many markets to justify additional development of warehouses and distribution centers. Chicago is positioned as a top market for this activity.
CBRE analyzed the gap between pro forma rents in various markets – the rental rates that developers can reasonably expect to obtain on newly built warehouses – and breakeven rents, which are the rents they’d need to cover overall development costs. In the 10 major markets that CBRE examined, the former exceeded the latter by 20 to 40 percent.
CBRE’s analysis also found the largest rent spreads in Chicago (43 percent), Atlanta (38 percent), Phoenix (35 percent), Pennsylvania’s I-78/I-81 corridor (30 percent) and Los Angeles (27 percent).
According to the report, Chicago currently has 9.3 million square feet of product under construction.
“Chicago continues to see a huge demand for distribution space, particularly along proven logistics corridors,” said Whit Heitman, senior vice president with CBRE. “With the number of tenants active in the market, demand is still not being met by the current construction pipeline.”
As creative and vintage offices continue to attract tenants, new investors are entering the market to capitalize on this unique product.
Large law firms in Chicago continue to contract their space as new workplace strategies allow for more efficiencies, and, provide firms the opportunity to attract new talent with more appealing and innovative layouts and designs, according to a recent report from CBRE.
Law firms, especially those requiring 75,000 square feet or more, continue to increase efficiency by reducing square-footage per attorney when opportunities arise. In the past 24 months in Chicago, approximately 70 percent of these large law firms have contracted their space when completing a lease transaction. Currently, the 25 largest law firms by square footage in Chicago average 800 square feet per attorney. As the downsizing trend continues, firms are aiming to achieve 550-650 square feet.
“Law firms are continuing to drive for efficiency with their space and we don’t see this trend changing anytime soon,” said Todd Lippman, vice chairman with CBRE and member of the firm’s Law Firm Practice Group. “As more law firms see the benefits of adopting new workplace strategies, both for financial and functional purposes, the square footage per attorney will continue to decrease and firms will be able to do more with less space.”
CBRE received three awards last week at the 30th Annual Chicago Commercial Real Estate Awards. Congrats to all of our winners!
Deal of the Year – Bank of America/GGP
Drew Nieman, Sara Spicklemire, Christy Domin, Michael Kazmierzak, Ellen Zalatoris
Office Investment Broker of the Year
Paul Lunstedt, Blake Johnson, Dan Deuter, Tom Sitz & Cody Hundertmark
Property Management Firm of the Year
Neil Pendleton and Asset Services team.
The event has raised more than $1.45M for the Greater Chicago Food Depository – a record for the event. Congrats to all who donated!