REmark: New Leasing Activity – Downtown vs Suburban Office
Chicago metro office leasing activity in suburban and downtown markets experienced a predictable fallout from the sweeping “stay-at-home” measures implemented in March 2020 due to the onset of the COVID-19 pandemic. However, the effects were more sharply-felt in the downtown office market, as new leasing activity fell to unprecedented levels (roughly 29 percent of the pre-pandemic quarterly average.)
New leasing activity in the suburbs outpaced downtown in both the third and fourth quarters of 2020, achieving roughly 65% of the pre-pandemic quarterly average. In fact, after a more than a three-year period where downtown office new leasing activity averaged more than 750,000 SF compared to the suburbs, the inverse is true since the start of the pandemic. The suburban quarterly average during this period exceeds downtown by over 300,000 SF. Early indicators suggest the trend continues into the first quarter of 2021 – we will be tracking the numbers and updating as the year progresses.