Office leasing velocity slows in Chicago CBD, but rents continue gradual climb
Office leasing velocity in downtown Chicago slowed in the second quarter of 2012, according to Jones Lang LaSalle’s newly released Q2-2012 Chicago Office Report. But while the overall vacancy rate downtown actually climbed a nominal 10 basis points from 14.0% in Q1 to 14.1% at the end of Q2 as a result, the protracted trend of of tightening vacancy figures to continue throughout the rest of the year, the report suggests, with big tenants like Google/Motorola Mobility, Aon Corp. and others expected to sign big leases soon.
As a result, rental rates continued to rise modestly in Q2 and have now climbed more than 60 cents/SF since Q2-2011 to $31.44 today.
The report finds reason to believe that a leverage shift (from tenant-favorable to landlord-favorable) could be on the horizon. Will tenants who’ve sat on the sidelines until now be motivated to act?
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