Each week, The Elevator Speech summarizes news related to some of the key industry trends, buildings, deals and dealmakers that shaped headlines. Below are articles that caught our attention the week of March 31.
Rise in Vacancy Rates Expected to Decrease Throughout 2014
According to a report by CBRE, Downtown Chicago office vacancy rates rose .3% from 14.4% to 14.7% percent during the first quarter of 2014. The reason behind this rise may potentially stem from some tenants shrinking their space. Vacancy rates are expected to lower again throughout 2014, as technology firms, such as Google, are increasing their space and major corporations are moving their headquarters to Chicago, such as Archer Daniels Midland Co.
Washington and Wabash Station Underway
Construction of a new $75 million CTA transit station at Washington and Wabash are slated to begin in August of this year. This station was originally due to begin construction in April, but plans were delayed due to an environmental study. Once completed, the Washington and Wabash station is predicted to have roughly 13,375 entries per day, which will make it one of the busiest Chicago stations.
First Japanese Investor in Eight Years
The 27-story tower at 203 N. LaSalle was recently purchased by a Tokyo-based conglomerate, Sumitomo Corp., for $111.5 million. This is the first acquisition by a Japanese investor in eight years. Although the 581,107 square foot building is currently 87% leased, the largest tenant in the building, DLA Piper LLP, will vacate more than 40% of that space in three years. DLA Piper LLP signed a lease at the West Loop River Point tower, which will be completed by 2017.
Top Q4 2013 Leases in Chicago and US
According to CoStar’s Fourth Quarter 2013 Market Report, the top two offices signed during the fourth quarter of 2013 in the Chicago market are as follows:
- 111 North Canal, where Gogo, Inc. signed a 234,484 square foot lease.
- Willis Tower, where Dentons US LLP signed a 125,553 square foot renewal of its space.
This report also mentioned that the largest leases signed in Q4 in the nation were from:
- GroupM Worldwide leasing 515,457 square feet at 3 World Trade Center.
- CME Group, Inc. leasing 449,000 square feet at the World Finance Center – NYMEX building.
- Valeant Pharmaceuticals International, Inc. leasing 310,000 square feet in the Northern New Jersey market.
Piedmont Office Realty Trust Scores Long Term Lease
R-T Specialty Group has signed a long-term lease at 500 W. Monroe St. for 27,000 square feet. R-T Specialty had a sublease through 2017 on the 28th floor of the 44-story building and intends to move on the 30th floor by the fall 2014. Piedmont Office Realty Trust owns and manages the building.
What CRE or Chicago news headlines from the past week captured your interest? Leave us a comment and let us know.