By: Daniel Schack, Analyst, Chicago Research
The economy continues to grow, as strong business fundamentals drive commercial real estate across the country. Just as companies fervently battle to attract much-needed talent, cities are engaged in their own battles to draw and retain companies. Cushman & Wakefield recently compared the 25 largest office markets in five factors that are vital to occupiers: economic growth, population makeup, transportation options, costs, and commercial real estate fundamentals.
As with many national comparisons, Chicago ends up looking attractive when compared to the largest U.S. cities. Its gross metropolitan product (GMP) is the third largest in the country at $497.3B. Chicago is one of the most diversified economies in the nation and home to more than 400 major corporate headquarters, including 36 in the Fortune 500.
Chicago is also home to a huge talent pool and a strong roster of well-regarded educational institutions, including two of the world’s top business schools. Nearly one-fourth of Chicago area residents are “millennials,” which is the sought after young worker demographic roughly aged in their mid-to-late 20s and early 30s. Additionally, with over 37% of the population possessing at least a bachelor’s degree, Chicago outpaces the national average by over seven percentage points (the national average is 30%).
Driven by strong economic and labor-pool growth and supported by the one of the best ranked transportation systems nationally, Chicago continues to be a business-friendly environment. The strong construction pipeline with 6.0+ MSF of space expected to deliver by 2020, is a clear indicator of developers’ confidence in Chicago as a strong and an attractive market. Chicago continues to be one of the more cost-effective office markets among the largest U.S. cities. Even though overall gross asking rental rates have increased 1.5% year-over-year, Chicago proves to be the best “bang for your buck” compared to other major office markets.
For more insights into how Chicago ranks among the 25 largest office markets, check out Cushman & Wakefield’s Location Lens map.
Sources: Cushman & Wakefield Research; U.S. Bureau of Economic Analysis; Moody’s Analytics; U.S. Census Bureau