Rhea Stephen

The situation: Even before the global pandemic, Chicago’s suburban office market was already bifurcated between the haves and the have-nots. Languishing office properties that lost their single-tenant occupiers sat virtually vacant for years — like the former 2.3-million-square-foot Sears headquarters in Hoffman Estates, which artificially inflated the area’s stabilized vacancy rate — while Class A office space in prime locations maintained availability rates below 5%.

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On the surface, the past 12 months were rough for Chicago’s commercial real estate market’s construction sector. Across the four major property types — industrial/flex, office, retail and multifamily — construction starts and square feet and units underway were down more than 40% from their previous eight-year (2015–23) averages. Though not as anemic, even hospitality construction is down from this benchmark by just over 20%.