Vacancies gradually mount across Chicago as deal activity slows, occupiers remain guarded

Greater Chicago’s industrial market remained under pressure in the second quarter of 2025, with softening demand and cautious tenant sentiment continuing to define market conditions. The overall vacancy rate rose to 7.7%, climbing 30 basis points (bps) from Q1 and 80 bps year over year, marking the third consecutive quarterly increase. While fundamentals are not deteriorating sharply, the pace of leasing remains sluggish and large-block vacancies are gradually mounting. Meanwhile, capital markets activity remained lethargic, stymied by cautious buyers, conservative underwriting and a bid-ask spread that continues to challenge deal flow.

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