Chicago’s industrial market remains a steady bet post pandemic

From “Chicago Industrial Market Performance” – The Real Deal

By Emma Whalen | April 30, 2026

Chicago’s industrial market has maintained a healthy supply-demand balance in the first quarter of the year, research from NAI Hiffman shows.

The activity stands out from other sectors that have gone haywire since the pandemic. Chicago’s office market is still facing significant over-supply concerns and the multifamily and residential markets are dealing with a severe lack of new supply.

But investors were not always sure the industrial market would come out of the pandemic unscathed. The sector saw a massive building boom as work-from-home policies and other changes to consumer habits increased demands for warehouses and distribution centers.

Since then, fears of oversupply appear to have been overstated.

Vacancy across the region improved by 10 basis points quarter-over-quarter to 5.9 percent, the report found. In the first quarter of 2020, before the full effects of the pandemic had been felt in Chicagoland, the region’s vacancy rate was just over 6 percent.

Now, new construction is following suit. A balance between built-to-suit and speculative development continues to even out, data from NAI Hiffman indicates. In the first quarter, about 53 percent of industrial developments were speculative and 47 percent were built-to-suit.

By comparison, in the second quarter of 2020, about 90 percent of new developments underway were speculative.

“I think the moves from tenants are more thoughtful and strategic now than maybe in the past few years,” said Denes Juhasz, director of research at NAI Hiffman. “[The market] seems like it’s transitioning into more of a sustainable growth cycle.”

Leasing activity among existing properties also remains steady, according to the Oakbrook Terrace, Illinois-based firm.

In the first quarter, new leases totaled 11.9 million square feet compared to 10.9 million square feet leased in the first quarter of 2025.

One of the most notable transactions of the first quarter was Hyundai Translead’s 1.3 million foot lease signed earlier this month at Industrial Realty Group’s manufacturing facility at 2700 Channahon Road in Joliet.

A San Diego-based subsidiary of the South Korean carmaker Hyundai, Hyundai Translead manufactures semi-trailers and heavy duty trucks for the North American market. It will set up shop at the former Caterpillar site, along with a nearby site that was formerly owned by Lion Electric, for a combined 52-acre manufacturing facility in Will County.

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About NAI Hiffman:

NAI Hiffman is one of the largest independent commercial real estate services firms in the US, with a primary focus on metropolitan Chicago, and part of the NAI Global network. We provide institutional and private leasing, property management, tenant representation, capital markets, project services, research, and marketing services for owners and occupiers of commercial real estate. To meet our clients’ growing needs outside of our exclusive NAI Hiffman territory, we launched Hiffman National, our dedicated property solutions division, which provides property management, project services, and property accounting services across the country. NAI Hiffman | Hiffman National is an award winning company headquartered in suburban Chicago, with more than 275 employees strategically located throughout North America.

About Hiffman National:

Hiffman National is one of the US’s largest independent commercial real estate property management firms, providing institutional and private clients exceptional customized solutions for property management, project management, property accounting, lease administration, marketing, and research. The firm’s comprehensive property management platform and attentive approach to service contribute to successful life-long relationships and client satisfaction. As a nationally bestowed Top Workplace, and recognized CRE award winner, Hiffman National is headquartered in suburban Chicago, with more than 275 employees nationally and an additional six hub locations and 25 satellite offices across North America.