Chicago downtown office space vacancy rate jumps to record high levels

"New data shows Loop vacancies ballooned over the recent third quarter as post-pandemic work trends continue to impact and impede demand. All told, companies reducing their footprint in the area over just the last two years have cost the business district 2.3 million square feet, or nearly twice the amount of space vacated during the Great Recession of 2009-2010."

"There has been some return to the office, but a lot of companies are opting to remain remote. One way that the city could address this is by making it easier to have commercial to residential building conversion. This is something that New York's Midtown Manhattan has been doing recently with a large degree of success."

""Downtown has become this place where people drive in in the mornings to go to work, then leave in the evenings," she said. "There's nobody in the area after they've left work for the day to stay and be paying customers. By looking at this as a way not to just decrease the vacancy rates but also to revitalize the downtown region can become a community and not just somewhere that people commute for work.""

Chicago's downtown office vacancy rate has reached a record-high 28 percent. Loop vacancies surged in the recent third quarter as post-pandemic remote work trends reduced demand. Companies cutting footprints over the last two years vacated about 2.3 million square feet, nearly double the Great Recession loss. Rising interest rates compound the challenge. Making commercial-to-residential conversions easier presents a policy option to lower vacancy, address a city housing crunch, and transform the Loop from a commuter district into a livable, active community with residents and local customers.

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