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Originally Posted by the urban politician
^ Where did anyone say that the suburban office market is thriving? You’re comparing office space to warehouse space? I mean, the downtown area’s office vacancy alone is often in the low teens, so 20% in that context isn’t too bad.
All that article said is that it’s not in a state of total collapse. It’s treading water despite a lot of HQ decamping for downtown, and has actually still had steady absorption.
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The Downtown vacancy rate is not in the teens, it's 11%. Several submarkets of downtown are in the single digits including River North. That's despite brisk new construction and addition of huge blocks of rehabbed space in recent years. In fact, single digit vacancy isn't healthy and indicates a severe supply shortage. What is healthy is vacancy in the 10-15% range being maintained in that range by consistent new supply.
My point is that, even though the rate has fallen from like 25% in the burbs, that's still not healthy because barely any new supply has been added and what little new supply like the Zurich offices has been built has been more than offset by demolition of corporate campuses. The suburban rate has probably fallen just as much because supply has gone off the market as it has from new job creation.
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