February 2023

Year-End 2022 Office Market Report

NAI Hiffman is pleased to present the Year-End 2022 Office Market Report, an in-depth look at the office market statistics for the Chicago metropolitan office real estate markets.

Suburban Office Market Fundamentals Uneven in 2022

2022 Year End Office Numbers

Chicago’s suburban office market faced significant headwinds in 2022, as rising interest rates and economic uncertainty largely paused major real estate decisions. Despite increased leasing velocity, vacancy remained near record highs at 26.0% during the fourth quarter. As corporate leaders continue to evaluate their office footprint in the wake of the pandemic, growth among existing tenants in the market has stagnated, though the market has shown some signs of moderation heading into 2023.

2022 Year End Office Graph

  • Net absorption totaled 207,578 square feet during the fourth quarter, bringing year-to-date absorption to negative 5,170 square feet.
  • The suburban Chicago office market recorded a 26.0% vacancy rate during the fourth quarter, up 10 basis points year-over-year.
  • Suburban office leasing velocity accelerated during 2022, with the 7.1 million square feet of new leasing activity representing a 26.1% increase year-over-year.

Downtown Fundamentals Soften

4Q22 CBD Office numbers

The downtown market softened during 2022, with vacancy reaching new cyclical highs as landlords have struggled to backfill large blocks of space amid tenant relocations and contractions within the market.

4Q22 CBD Graph

  • Chicago’s CBD softened during the fourth quarter, with 602,649 square feet of negative net absorption, bringing year-to- date absorption to negative 1.5 million square feet.
  • The downtown market registered 1.3 million square feet of new leasing activity during the fourth quarter, down from 2.4 million square feet last quarter, and the pandemic average of 1.9 million square feet since the start of 2020.

Detailed statistics and commentary are available in the Year-End 2022 Office Market Report; enter your e-mail address below to access the download:
Detailed quarterly submarket reports will be available in the coming weeks.

Contact Us
For further information regarding the content of this market report, please contact:

Nick Schlanger
Research Director

About Hiffman National: 

Based in the Chicago area, with an additional five regional hubs and 30 satellite offices, Hiffman National provides superior property management, project services and accounting services to a diverse portfolio including office, medical office, retail and industrial properties nationally. The firm’s comprehensive property management platform and attentive approach to service contributes to client NOI and has helped the firm to more than double in size in five years. Hiffman National is an award-winning company with more than 250 employees strategically located throughout North America.

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 and award winning company headquartered in suburban Chicago, with more than 250 employees strategically located throughout North America.

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