LIVE BLOG: BisNow Chicago “State of the Suburbs” event

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JLL’s Doug Shehan (left) is part of a panel discussion on the state of the Suburban Chicago office market that also includes Arden Realty’s Laura Quayle Hamilton Partners’ Michael Rolfs and several others. More than 250 people are on hand to watch.

Here’s a “play-by-play” run-down of the conversation:

8:50 a.m. — Quayle on the general state of the market: “In general, we feel pretty optimistic. We feel like the market is on a slight up-tick. But I think the suburbs have a long way to go before we see the kind of leasing velocity that we’ve seen in the city.”

8:52 a.m. — Shehan on the major challenges facing the market: “We’re not going to see new construction for a long time, but we are going to see more and more build-to-suits (Takeda, Hub Group, Astellas) and those have really hurt the leasing market.”

8:57 a.m. — Shehan on the sublease market: “If you look at the terms on the subleases out there, probably only 5 in 100 are actually viable because the terms are so short.”

9:02 a.m. — Shehan on the Evanston market: “It outperforms almost every other market in terms of rental rates and vacancy rates. I think the public transportation is one of the reasons driving that.”

9:04 a.m. — Shehan: “Overall, the biggest challenge in the suburbs is public transportation. The train lines run into, for example, downtown Downers Grove, and all the office properties are on the perimeter of town. Also, densities are rising in office spaces and that’s a definite advantage to the city as well, because they don’t have to worry about the parking.”

9:08 a.m. — Shehan on parking: “You look at all of the big deals that have been done, especially in the Northwest Suburbs, and they’ve all had some element of bonus additional parking.”

9:10 a.m. — Shehan: “One of the major advantages that you have in the suburbs is that you can still find a single-tenant building, and that’s almost impossible to find in the city.”

9:15 a.m. — Rolfs on spec development: “We won’t see it until we see real job growth. It’s just not going to happen.”

9:16 a.m. — Shehan on workplace trends: “More and more companies are going to a more collaborative, hoteling-style arrangement. They’re packing a lot more people in and there’s a lot more density.”

9:18 a.m. — Quayle: “We’re seeing a lot of financial services companies opening new offices in suburban Chicago for the first time since they started shutting them down four or five years ago. That’s been very positive news for us.”

9:20 a.m. — Quayle’s predictions for 2014 and beyond: “You’re going to see more landlords trying to push rents but at the same time being very aggressive with concession packages.”

9:25 a.m. — Shehan’s predictions for the future: “The corporate confidence out there over the past year has really been gaining and that’s good news.”

9:29 a.m. — Shehan on the suburbs’s place in the grand scheme of the Chicagoland leasing market: “You hear a lot of news about companies moving downtown, but of the 32 Fortune 500 companies in Illinois, only 6 are downtown. The suburbs are still winning.”

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