Chicago Industrial Market Report

Tenant demand favors newer builds. Net absorption rose about 90 percent in the 12 months ended June from an unusually weak prior year, though it remained well below longer-term norms. Recent demand was mainly in post-2020-built spaces above 250,000 square feet, with distribution facilities driving most occupancy gains. Overall leased square footage increased 45 percent as tenants favored modern, large-bay properties. Leaner inventory strategies, meanwhile, may be weighing on demand for storage-oriented warehouses. In contrast, goods movement and demand for modern facilities may continue to support tenant preference for larger, regionally connected distribution space.