Q1 2024 Chicago Office Market Report

Chicago’s downtown office market continues to shed space as vacancypushes further upwards, landing at 24.7 percent to end the first quarter of2024. Substantial chunks of sublease space have started to convert to directspace as natural lease expirations begin to roll into direct space, compoundingpressure on landlords. The trophy class continues to charge forward with everincreasing demand for premier space.

All submarkets and other asset types continue to suffer adverse impacts withno submarket or class shielded from negative movement. Landlords throughoutthe city are challenged to find creative transaction structures to renew or landnew tenants. With return-to-work occupancy levels remaining relatively flat,coupled with a significant deacceleration of knowledge worker employment,demand will likely remain muted for the near to mid-term.

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