Bradford Allen released its Q2 2023 CBD Office Market and Mid-Year 2023 Suburban Office Market reports. In the second quarter, absorption in the CBD improved to 64,000 square feet compared with negative 1.8 million square feet from the previous quarter as companies favored newly developed and renovated space. The Q2 2023 CBD office vacancy rate remained at 19.2%, while leasing volume dropped to 1.3 million square feet -the lowest since Q4 2020-. Average gross asking rates slightly increased to over $44 per square foot from just under $43 per square foot in Q1 2023 .
In contrast, suburban office asking rents stayed unchanged at just below $27 per square foot; however direct vacancy rate decreased from 28.3% to 26.9%. Most of this year’s office sales in suburbs have been vacant buildings poised for redevelopment and more than a third of all purchases are likely destined for alternate use conversion purposes .
Chicago’s Central Business District (CBD) is searching for a bottom while suburban office leasing velocity remains strong according to Bradford Allen’s latest market reports on Chicago’s commercial real estate sector during 2nd Quarter (Q2) of 2021 and mid-year 2021 respectively..
