For the fourth consecutive month retail sales nationally has rose. Americans are gaining confidence in spending as employment rises and household wealth increases due to higher home values and stock prices. The Conference Board's Consumer Confidence Index improved in August but decreased in September from 81.1 to 79.7. Even with the upswing of household purchases and improvements in the economy consumer spending is still unstable and flexing. For a stable and healthy economy The Index needs to be above 90 and remain.

 

For the Chicago retail market, the third quarter of 2013 ended with a slight increase in the vacancy rate to 8.9% from 8.8%. With the increase of vacancy the asking net asking rents have dropped to $16.97 per square foot. Since last year, the vacancy rate has increased 20 basis points with net asking rental rates slightly increasing.

 

Even with low vacancy levels such as in the Southwest Suburbs which stands at 5.3% - Landlords still are competing heavily for deals. Rental rates have not increased and tenant still have many options available. The tough part for most owners is they have one to three vacant units depending on the size of their centers. These units are usually the hardest suites to lease causing Landlords to be very aggressive in deal negotiations. Another reason for the lack of raising rental rates, from my personal experience, is that Tenants are watching their costs very tightly. Most likely due to the uncertainty of the market and the federal government.

Submarket

Far N.W. Suburbs
N.W. Suburbs
Far North Suburbs
North Suburbs
Far West Suburbs
West Suburbs
City North
City South
Far S.W. Suburbs
S.W. Suburbs
South Suburbs
Kane County

TOTAL

Gross Bldg SF

13,177,796
14,911,156
8,258,998
9,438,018
22,031,280
7,920,311
8,135,510
5,555,599
9,809,672
8,179,246
6,504,106
11,179,576

125,101,268

Vacancy Rate

7.8%
9.5%
9.3%
6.8%
11.3%
4.3%
5.8%
7.8%
6.3%
5.3%
20.6%
10.5%

8.9%

Average Asking Net PSF

$15.12
$19.06
$12.06
$20.53
$17.37
$16.25
$20.86
$19.70
$15.77
$15.70
$13.64
$15.07

$16.98

Even with the versatile market; Chicago area is experiencing new retailers entering the market

statistical information provided by CBRE Chicago Retail MarketView Q3 2103
Kristian Lee (88 Posts)

Kristian is a licensed Illinois Commercial Real Estate REALTOR since 2003 working with small to medium sized businesses locally and nationally as well as owners of real estate from office, retail to industrial at Village Commercial. in Frankfort, IL. Kristian specializes in branding each property he represents through different marketing tactics, boots on the ground and the latest technologies gained from his experience. For each tenant representation assignment he becomes his client's "in-house" broker walking them through the process from initial meeting till occupancy. He is the founder of Commercial Main N State, a blog and VBlog providing tips and market rental trends to small businesses on #CRE. He currently on the Board of Directors of the Mainstreet Organization of Realtors®


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