The Real Finds Podcast, Episode 110: Q3 2026 State of the Chicagoland Commercial Real Estate Market

Gordon Lamphere, J.D., of Van Vlissingen and Co. delivers the Q3 2026 State of the Chicagoland Commercial Real Estate Market, a solo walk through office, industrial, multifamily, retail, and, for the first time as its own segment, land. Every number is pressure tested against the RFP Chicagoland Commercial Real Estate Index. This transcript has been lightly edited for clarity. The written report with charts is available here, and prior editions are at Q2 2026 and Q1 2026.

Gordon Lamphere (00:00): I told you the waiting was over. This quarter, the market did something more interesting than move. It picked sides. Capital, tenants, and developers all made choices in the last 90 days that tell you exactly where they think Chicagoland is going, and some of those choices would have been unthinkable 18 months ago. Somebody is trying to put a shovel in the ground for a new downtown office tower. In this market, in 2026. And that is not even the most surprising thing that happened this quarter.

Gordon Lamphere (00:41): Here is how today is going to work. I am going to walk you through five markets: office, industrial, multifamily, retail, and, for the first time in its own segment, land. Each one of these markets produced one number this quarter that changes the conversation. I am going to hold all five of those numbers until the end, because I want you to hear the story first and the punchline second.

First, I am Gordon Lamphere, a broker, advisor, and Vice President at Van Vlissingen and Co. We are deep into another meaningful transaction volume year across every asset class we are going to talk about today, and that volume matters, because it means the analysis you are about to hear is not assembled from press releases. It comes from lease negotiations we are sitting in, sale processes we are running, and site searches we are conducting.

Everything we talk about today gets pressure tested against the RFP Index, our aggregated Chicago CRE data set at rfp.vvco.com. Before the asset classes, two minutes on the data, because the quality of your data matters, and it matters more than ever in a market this divided. We built the RFP Index because we got tired of relying on any single source for real estate data. Every brokerage, CoStar, Cook County government, they all publish their own reports. If you pull all of those reports on the same market for the same quarter, you often find disagreements. Sometimes a little, sometimes enough to change your underwriting. This quarter we saw one of the clearest examples we have had since we started the index. Depending on where you pulled your reports, Chicagoland industrial vacancy was either 4.8%, 5.3%, or 6.1%.

Same market, a 130 basis point spread, driven entirely by how each firm defines its inventory set and whether availability is being blended into vacancy. Nobody is being dishonest. One firm tracks a broader geography. Another includes buildings the rest of us would probably exclude. And a third counted marketed but occupied space in a way that reads like vacancy if you are skimming.

Gordon Lamphere (03:07): Think about what that spread does to real decisions. If you underwrote an acquisition off the high number, you priced in slack that does not exist, and you probably lost the deal to somebody who read the market correctly. If you underwrote it off the low number, you assumed pricing power the broader market may not support, and you will find out in the lease-up. So what does the RFP Index do?

We aggregate all the major sources into a single, live-updating index using comparable data points for each metric. We are deliberate about what we include and what we exclude. We do not mix availability rates with vacancy rates. We do not backfill a current quarter with a number pulled out of thin air. We do not let any single source dominate the output. And when sources disagree, we do not pick a winner. We show a range and we use the aggregate. The result is a less exciting number than any individual firm’s headline, and a more defensible one. It is public, it is free, and it is at rfp.vvco.com.

Now the backdrop, and then the five markets. The macro story this quarter is about continuity, not change, and in this environment, continuity is itself a substantial amount of information. The cost pressures I have been naming all year, steel and aluminum tariffs, tightened immigration enforcement pulling workers out of the trades, elevated material pricing on everything from copper to conduit, did not moderate. They compounded. Chicago construction costs are still running well above trend year over year, and the trades most exposed, electrical and mechanical, are now being actively bid away by data center projects, which we will get into in the land segment. If you are carrying a construction budget from even 12 months ago, it is stale. On rates, the direction is mildly friendlier than a year ago, and debt is more available than it was. But capital is still expensive relative to the entire pre-2022 era.

Gordon Lamphere (05:33): And the underwriting discipline that came with that era has not loosened. The deals clearing this quarter are clearing on in-place economics: current cash flow servicing current debt. The buyers who need aggressive rent growth assumptions to make their math work are still on the sidelines, and honestly, the market is a lot healthier for it.

So who is buying? The buyer composition in Chicago right now is worth 30 seconds, because it has shifted. Family offices and private investors have carried Chicagoland’s transaction volume for the last two years while institutions watched from the sidelines. Now we are starting to see institutional re-engagement, most prominently in multifamily, but it is broadening, and it is showing up on bid sheets. More institutional names in underwriting, tighter spreads between the first and second place finishers, and faster timelines from LOI to close on clean deals. Institutions are not buying stories. They are buying increasingly better fundamentals. Chicagoland is not unique among major US metros right now, but it has strong fundamentals in four of the five asset classes we are going to discuss today. The era of Chicago trading at a permanent skepticism discount is not over, but for the first time in many years, that discount is substantially narrowing.

One more structural point before the asset classes, because it frames everything. When it is this expensive to build, built product wins. Every asset conversation today, office, industrial, multifamily, retail, or anything you are going to develop on land, is downstream from the single fact that replacement cost has moved so far above market value for most asset classes in Chicagoland that new competition mostly cannot show up. If you own good, stabilized, leased real estate in this market, the construction crisis is your moat. If you need to build, it is your problem.

Gordon Lamphere (08:01): Frame the conversation with that in mind. Here is a sentence I did not expect to say on this show in 2026: Chicagoland may break ground on a new downtown office tower. While every headline in America is still running the office apocalypse story, a major law firm just committed to anchor a proposed 45-story building in the West Loop, and downtown Chicago just posted its first quarter of positive direct net absorption since 2023. If you think you know the Chicago office story, this segment is going to make you a little uncomfortable in the best way.

Last quarter, I told you prime CBD office space was running out. You might have doubted me, but we are seeing one delivery in all of 2026 and nothing behind it until 2029. This quarter, the market responded to that scarcity. Sidley Austin signed on for more than half of the proposed almost one million square foot office tower at 725 West Randolph, which would be the CBD’s first office groundbreaking in years. You read that correctly. One of the most sophisticated occupiers in this market looked at existing trophy inventory, looked at the pipeline, and concluded the only way to get space they actually wanted was to wait until 2030 and build new in the most expensive construction environment Chicago has seen in years. That is not behavior you see in a dying market. That is behavior you see in a market that is short of the product that matters. Every other large tenant with a late-decade expiration, watch them do it.

The absorption data backs it up. CBD direct net absorption came in a little over half a million square feet in Q2, the first positive direct quarter since 2023, and direct vacancy fell to roughly 24.4%. Now I want to be very careful, because the aggregate numbers still carry real pain.

Gordon Lamphere (10:25): Overall absorption, including sublease, was still modestly negative on some measures, and Class A is doing all the lifting. Class A posted over 300,000 square feet of positive absorption while commodity product kept bleeding. Part of the vacancy stabilization is subtraction, not demand. Obsolete buildings keep getting pulled out of the office inventory for residential conversion, which flatters the vacancy numbers while shrinking the denominator. I would rather you hear that from me than discover it in a footnote. The bifurcation is not softening, it is accelerating, and the inventory itself is being redefined underneath the statistics.

Here is the dynamic I told you to watch last quarter, now playing out in real time: the 2026 lease rollover wave. A significant volume of CBD leases were signed in a completely different market, with different rents, different build-outs, and different assumptions about how people work. Those expirations are coming through now, and the tenants behind them are being forced off the fence. Our own Chicago office deal flow splits into three categories. Roughly a third are renewing, usually on shorter terms, and usually after testing the market and discovering that the move economics do not pencil once you price in 2026 build-outs. A third are moving, almost always up in quality and down in square footage, paying a higher rate per foot for less total footprint and calling it a win, because for many of them it is. And a third are still procrastinating. Those are the ones I worry about, because the trophy blocks they assume will be there in 12 months are exactly the space that is disappearing.

The concession environment tells you where leverage is heading. In commodity and Class B product, concessions remain enormous. Free rent is measured in years on long-term deals, with TI packages that would have been unthinkable in 2019, because those landlords are fighting for survival.

Gordon Lamphere (12:52): In genuine trophy product, however, concessions have curtailed, and on the best floors of the best buildings they are quietly shrinking. When the concession curve bends before the rent curve, that is telling you the repricing at the top is generally over.

One trend that jumped out of both our own deal flow and the aggregated data: move-in ready suites now account for close to 37% of all CBD leasing activity this year, nearly double their share from 2023. Tenants look at construction pricing, they look at the length of a build-out, and with the strain on the trades, they are paying premiums to skip the whole exercise. This connects directly to the macro picture. Trades are driving up costs everywhere, and more occupiers are willing to pay for certainty, not just on pricing, but on timelines.

The AI tenant thread from last quarter also deepened. The requirements coming from AI and AI-adjacent companies keep pulling in one direction: power density, cooling, and collaborative floor plates. Buildings that delivered on those, or were renovated within the last decade to accommodate them, are seeing a surge in leasing activity.

The suburban story deserves a more generous read than it usually gets. Suburban Chicago just recorded its strongest first half of net absorption since 2018, and vacancy has eased from year-end 2025 levels. That does not mean the pain is over. Market-wide suburban office vacancy still sits around 27%. But we are seeing positive signals and real green shoots. For much of the suburban stock, it is a redevelopment story now, not an office story. But in the corridors with real workforces and real reasons to exist, the picture is different.

Gordon Lamphere (15:16): In Lake County, the I-88 corridor, and the Northwest submarkets, the flight to quality is producing genuine rent growth, north of 6% year over year, and some measures show the best buildings outpacing even that. We are seeing transactions in those corridors every month, and what we see on the ground matches the data. Companies with strong suburban workforces are not debating whether to have offices at all. They are debating which buildings they want to be in, and they are paying up for the right ones. If you wrote off suburban office entirely, the data says you wrote it off too soon. And if your lease expires in the next 18 to 24 months and you want top-tier space, everything I said last quarter is more true than ever. Start now, not next quarter. There is one number from this market I am saving for the end, because it reframes what a recovery means.

Now, industrial. At the start of this year, the industrial doomers finally had their headline: Chicagoland’s slowest absorption year since the Great Recession. Six months later, that narrative is dead. Chicago just put up its strongest mid-year leasing totals in years. Absorption is up triple digits from last year, and the vacancy that spiked is holding near historic levels. If you traded out of Chicago industrial based on that 2025 headline, this segment is going to hurt.

Net absorption through mid-2026 totaled roughly 5.1 million square feet, up 146% from the same point last year, contributing to about 3.3 million square feet of reduced vacancy on our aggregated read. Vacancy sits in the high fours to low fives, and although there is disagreement among sources, as I discussed in the opening, even the most conservative published number leaves Chicago meaningfully tighter than the national average.

Gordon Lamphere (17:40): The national average just posted its first vacancy decline since 2022 and still sits around 6.5% to 6.9%. Chicago is one of the tightest major logistics markets in the country, with less slack than almost any metro of similar size, and the O’Hare and Elk Grove corridors remain arguably the tightest major industrial submarkets in America.

It is important to understand that big box deals are still doing much of the heavy lifting. RJW Logistics took 1.2 million square feet in the Fox Valley, and Hyundai Translead signed for more than 900,000 square feet in the I-80 corridor. Deal sizes are growing, and after two years of shrinking, lease terms are lengthening. Tenants are signing seven and ten year commitments instead of the defensive threes and fives we saw during the tariff uncertainty. When occupiers extend their duration, they are telling you what they believe about their own demand.

The reshoring thesis I have been walking you through for a year keeps converting from theory to leases. That does not necessarily mean the tariff regime worked, but we are seeing meaningful American onshoring. Operators who spent 2024 and 2025 studying the math on the global economy are now running real site selections in Chicago, specifically manufacturing that needs what Chicago has: heavy power, water, freight infrastructure with six Class I railroads, a deeply skilled legacy trades workforce, and a central geography that puts you within a day’s truck of most of America’s population. Chicago might not win the low-complexity assembly plant requirements. Those tend to go further south. What Chicago is winning is advanced manufacturing, food production, and components with real infrastructure requirements. In our own site selection searches this year, the share of requirements that are production rather than pure distribution is the highest I have seen in my career.

Gordon Lamphere (20:03): And the questions those users ask are different. Not “what is the rent,” but “what is the power, what is the ceiling on the power, and how fast can the utility deliver.” That brings us to another major theme of this episode: power is the primary differentiator in the market. Buildings that can deliver heavy power price first. Buildings that cannot compete on price alone, and rent is a deteriorating position. When we evaluate an industrial acquisition or run a site comparison for a client, the utility conversation is now happening before the rent conversation.

Here is the nuance underneath the headlines. The strength is concentrated in Class A and big box product, which is getting absorbed at a pace we have not seen since 2022, while small bay and commodity space is where the move-outs are starting to occur and sublease growth is going live. Vacant sublease space is up around 5.6% year over year, concentrated in Western Cook, the I-55 corridor, and the southern Fox Valley. Tenants coming off mid-pandemic five-year leases are right-sizing and consolidating from several older buildings into newer ones. That is not weakness. That is the market repeating, louder, what it has been saying for two years. Power, clear height, location, and infrastructure get paid. Everything else competes on price. It is the inverse of the small bay versus big box split we tracked earlier in the cycle.

Rent growth tells the same story. The market average is up a modest 1% year over year to roughly $7.55 per foot, but the submarket dispersion underneath is enormous, with corridors like Southern DuPage posting massive gains while commodity corridors went flat or backwards. Averages are hiding more than they reveal right now.

Gordon Lamphere (22:29): Which is exactly why we built the RFP Index. Last, and this is critical: if you have an above average power requirement, my advice is the same as last quarter. Start early. It takes 12 to 24 months, the users competing with you for that same capacity are lined up for power upgrades, and they are often willing to pay more than you are. If you have a high power requirement, start a focused search at least 12 to 24 months out.

Now, multifamily. Chicago is about to finish a year in which it delivers fewer new apartments than at any point since 2012, in a metro of more than nine million people, during a national affordability crisis. If you want to understand why institutional capital that ignored this market for a decade is suddenly circling, that single sentence is the whole thesis. Let me show you what it looks like from the inside.

Occupancy across the metro is sitting around 94.9%, well above the ten-year average, and effective rents are up roughly 3.2% year over year, among the strongest rent growth of any major US metro. Renewal conversion crossed 60% earlier this year, a multi-year high, which means fewer units are even coming back to market. When a unit does not turn, there is no vacancy, no loss, no make-ready cost, and no marketing spend. Operators are quietly having their best expense-side year in a long time while the revenue side grows. Meanwhile, the national picture is the mirror image: record high national vacancy, Sun Belt markets still choking on 2021 and 2022 deliveries, and rents in supply-heavy metros going backwards.

Gordon Lamphere (24:44): While forecasters tell national investors to wait for the second half of the cycle, understand that Chicago is not outperforming because demand exploded. Chicago is outperforming because we structurally cannot oversupply this market. The pipeline confirms it. Roughly 9,900 units are under construction metro-wide, about 1.6% of inventory, the thinnest pipeline of any major metro in America. And for the first time in memory, the majority of that pipeline, around 53%, is in the suburbs. Ground-up urban development barely pencils, so the pipeline that exists is migrating to where land and entitlements are cheaper. Adaptive reuse downtown has moved from a curiosity to a real supply channel. The Loop conversion wave is now a measurable share of scheduled deliveries, which is a remarkable sentence. The office market’s losers are becoming the housing market’s pipeline, and both markets are better for it.

The demand side has a structural anchor that does not get enough attention: the for-sale market is frozen. A decade of underbuilding across Illinois, plus millions of homeowners sitting on sub-4% mortgages they will never surrender, means the starter home inventory that historically pulled higher-income renters out of Class A apartments is simply not there. The renter cohort that would have bought a house at 32 in any prior cycle is renting at 36, and renting nicer, which is exactly the demand profile that builds the top of the market and keeps renewal conversion above 60%. I do not see the mechanism that unfreezes this in the next 24 months. Rates would have to fall more than any forecast suggests, or inventory would have to appear out of the ether.

Gordon Lamphere (27:05): And construction costs guarantee it will not. Now to the development math, because it explains everything. Multifamily construction costs in this market are up 30% from five years ago. Labor alone is up nearly 20%, and the trades are getting scarcer, not cheaper, for the data center reasons we keep circling. Run the numbers on a generic urban mid-rise today, with financing costs at current rates and a realistic lease-up, and the rent you need to justify the project is meaningfully above the rent the market pays, except in a handful of premium submarkets. That is the whole story. That is why so few units are getting delivered. It is not that developers lost interest in Chicago. It is that market rent and replacement cost do not match up, and until they reconnect, the only thing we are going to see is rent growth, because costs are not coming down.

Transaction activity keeps climbing past last year’s levels, and the buyer pool is broadening. Family offices and private capital carried the market for the past two years, but now larger allocators are moving from underwriting to closing, with a strong appetite for stabilized Class A and value-add Class B in supply-constrained neighborhoods: the North Lakefront, the Northwest Side, and Lake County corridors with genuine employment and community anchors. Cap rates on well-located Class B product are in the low to mid sixes, and that compression has room to run if the supply picture stays this tight, which, given the math we just walked through, it will. But I will say again what I said last quarter, because it is still true and getting more true.

Gordon Lamphere (29:26): This market is robust partly because we are having a housing supply and affordability crisis, and the longer rent grows ahead of incomes, the larger the political risk premium for every Chicago multifamily investor. Rent regulation conversations get louder in exactly these conditions. Transfer tax proposals are resurfacing. The politics of a 95% occupied, rent-growing market in an affordability crisis are not stable. I am not predicting a specific policy outcome, but your underwriting should carry a line item for the possibility. The opportunity and the risk are real, and they are the same phenomenon. The number I am holding back from this section will tell you how long the squeeze lasts, and it is at the end.

Now, retail. Chicagoland retail rents are growing, vacancy is near historic lows, and institutional money is buying grocery-anchored centers with real conviction. Here is the strange part: leasing is slower, absorption has been negative in stretches, and consumer spending is visibly tired. How are both true at the same time? One word: scarcity. Nobody has built meaningful retail in the Chicago market in a decade, and this quarter proved how much that protects landlords and how little room for error tenants have left.

The mid-year picture across Chicagoland is a vacancy story holding roughly flat in the low to mid fives. Availability keeps tightening because demolitions and conversions are removing functionally obsolete space faster than anyone can add it.

Gordon Lamphere (31:38): Rent growth, although cooling to around 1.5% to 2.5%, has not meaningfully ticked up or down. So what can we gather from the market as a whole? Most of all, there is a massive divide between the high-growth parts of the market, the parts that have stabilized, and the parts where we could see real deceleration. It is important to understand where each sits.

Tariffs did not drive this. What we are seeing underneath is a category split that is textbook. Necessity is driving everything. Retail from grocery to food and beverage is driving positive growth and has barely winced at the negative macro trends. Discretionary categories like apparel and electronics are where the trouble is, and that trouble is increasingly concentrated in big box centers that relied heavily on those categories.

But here is what matters most for owners. With no new supply pipeline, every closure is a backfill opportunity rather than a vacancy spiral. When a box goes dark in a decent trade area today, the leasing calls start before the announcement finishes, often from medical, fitness, grocery concepts, and experiential users that could not find space during the tightest years. The national market tells the same story: vacancy near historic lows, construction completions at rock bottom, and four straight quarters of positive absorption. Retail has quietly become what office wishes it were: a scarce, cash-flowing income asset that trades on in-place economics.

Gordon Lamphere (34:06): The capital markets have noticed. Institutional buyers are backing retail for the first time in decades, and grocery-anchored product in established Chicagoland demographics is trading at prices that reflect genuine conviction, not distress hunting.

Within Chicago proper, the split is stark, and it is worth naming plainly. Office and tourism dependent districts in the Loop and the Magnificent Mile are still carrying double-digit retail vacancy, while neighborhood corridors and mixed-use districts like Fulton Market and River North stay tight, with trophy corridors commanding $90-plus rents. That is a four-times-plus spread over metro average rents inside the same city. The Mag Mile recovery is real but incremental, with foot traffic rebuilding and a few meaningful re-tenancies. The Loop is the more interesting play, particularly given the conversion story. As the conversion wave shrinks office inventory, we are going to see thousands of residents on blocks that never had them, and those residents need grocery, gym, dry cleaners, and dinner. Loop retail is a 2028 story being set up in 2026, and the investors quietly buying ground floor space at today’s basis understand exactly that.

Two near-term trends to watch. First, the Bally’s permanent casino opening in River West, which is going to redraw foot traffic patterns on the Near North Side. Second, the continued suburban downtown renaissance in the walkable cores of Lake County and the North Shore, where transactions are as tight as I have ever seen them. The retail-as-amenity thesis I laid out last quarter is panning out.

Gordon Lamphere (36:29): Ground floor retail is the activation layer of mixed-use projects, and it is showing up in nearly every infill redevelopment conversation on the North Shore. Developers have stopped underwriting that retail as an income driver and started underwriting it as the thing that leases the apartments above it. There is also a cautionary tale in the suburbs. Be careful with regional mall exposure dressed up as redevelopment. There are good repositioning projects in the market that are well capitalized and could be incredible land plays. But they should be priced as risky redevelopment land plays. There is one retail number I am saving for the close, and it is the clearest picture of the two-market split you will see anywhere.

Now, land. The most violent repricing in Chicagoland commercial real estate in years is happening right now, and it is not happening in office towers or apartment buildings or suburban malls. It is happening in farmland. Parcels that traded for $15,000 to $60,000 an acre as agricultural ground are now being underwritten by data center developers with gigawatt ambitions. Established industrial land near O’Hare runs a quarter to half a million dollars an acre, and that same dirt can be worth five times that depending on one question: whether power can be delivered, and whether you have the ability to turn it into a data center.

Twelve months ago, Chicagoland data center demand was a directional argument. Now look at the tape. Tract paid roughly $51.5 million for 343 acres in Morris, fully zoned, with a transmission agreement supporting one gigawatt at full build-out. Joliet approved the annexation of 795 acres for a roughly $20 billion, 24-building campus, which would be the largest data center development in Illinois.

Gordon Lamphere (38:52): Microsoft has assembled roughly 500 acres in Plano. Capacity under construction across the Chicagoland market has seen triple-digit year-over-year jumps, while legacy hubs like Northern Virginia have flattened against their own transmission walls. Chicagoland has gone from a respectable secondary market to a genuine tier one contender on nuclear baseload, fiber density, substantial water, and deep trades workforces.

Study the pattern in those deals for a second, because it is instructive. Tract did not buy a building. They bought an entitlement plus a signed transmission agreement. The Joliet project’s first real milestone was not a lease. It was an annexation vote. The asset being created in all of these transactions is permission: zoned land with contracted power on a defined timeline. The dirt is almost incidental. That is why the pricing spread between power-ready and power-hopeful land has blown out to multiples rather than percentages, and why the single most valuable document in Chicagoland real estate right now might be a utility will-serve letter. We have written about this in valuing data centers and adjacent properties, and we went deep on it with Ron Rohde in RFP 106.

But this year also showed the other side. Barrington Hills pushed out a $2 billion proposal after community opposition. Naperville killed a project over power availability. Resistance on noise, water, and utility bill fears is organizing across the Collar Counties and into the Northwest Indiana corridor. And the state paused new data center incentive agreements as of July 1, injecting real uncertainty into the pipeline going forward.

Gordon Lamphere (41:13): Entitlement risk is now the primary risk in this asset class, ahead of capital and ahead of demand. The demand is effectively unlimited on any timeline that matters. The permissions are not. That means the communities that decide they want data centers, and organize their zoning, their utilities, and their community engagement to deliver, with Morris as the model, are going to capture a wildly disproportionate share of data center investment.

For most investors listening, the play still is not the data center itself. You are not writing a $20 billion check, and you do not want to compete with the people who can. It is the halo: land in corridors where utility infrastructure is being upgraded, industrial buildings with existing heavy power that suddenly screen for a dozen new users, and infill parcels near new substations, because a substation built for a campus de-risks every parcel around it.

All right, you stayed to the end. Here is the payoff: the five numbers that matter. These will tell you where Chicagoland actually is in the third quarter of 2026.

One, office: 968,000. That is the square footage of the tower proposed at 725 West Randolph, more than half of it already committed by a single law firm before a shovel hits the ground, in a market the national press still calls dead. The scarcest commodity downtown is the future of Chicago’s office supply, and the most sophisticated tenants are paying up for it, years in advance. When occupiers start funding new supply in a 24% vacant market, they are telling you a lot about the 24% they are not shopping in.

Two, industrial: 21.8 million square feet. That is new leasing activity through mid-year.

Gordon Lamphere (43:38): The strongest first half since 2022, and the third highest total of any market in North America, behind only Dallas-Fort Worth and the Inland Empire. Remember the headline: the slowest year since the Great Recession. That headline lasted exactly two quarters. Demand did not leave. It repositioned, and it came back bigger and longer-term than it left.

Three, multifamily: 4,000. As in fewer than 4,000 new units delivering across the entire metro this year, the smallest pipeline since 2012, in a market that absorbs multiples of that under normal conditions. That number tells you everything about why Chicago is a landlord-friendly market, and why it is a multi-year condition. The units that are not under construction today cannot exist before 2028, and the construction math says what every landlord in Chicago already understands.

Four, retail: 30 versus 5. Roughly 30% retail vacancy in the Loop against sub-5% in the strong neighborhood corridors. Same city, same quarter, a 25-point spread. There is no Chicago retail market. There are two. The entire game is knowing which one your retail assets are in, and whether the conversion wave is about to move your asset from one to the other.

Five, land: 1.8 gigawatts. That is the targeted capacity of a single approved campus in Joliet on 795 acres of what was farmland 18 months ago. For scale, that is roughly the output of a nuclear reactor committed to one real estate project. Power is the new location, and this is what it looks like when that thesis gets fully priced.

Step back, and four of those five numbers point in the same direction: scarcity. Scarcity of prime space.

Gordon Lamphere (46:01): Of modern logistics, of housing, of power. It is the single organizing force in the Chicago market, and it is all downstream of the same root cause. This has become an extraordinarily expensive market to build in, so what is already built and already powered wins. The fifth number, the retail split, is the warning label on the whole thesis. Scarcity only protects the assets on the right side of the line. The entire job in this market is knowing exactly where that line runs through your portfolio.

Gordon Lamphere (46:46): If one of these five numbers touches a deal or decision you are working through, call me, email me, or text me. I mean that. It is how some of our best client relationships start. And the full aggregated data set behind everything you heard today, every asset class, every submarket, every source, is live, free, and regularly updated at rfp.vvco.com. See you next quarter.

Van Vlissingen and Co. has been the Midwest’s oldest commercial real estate brokerage, development, and management firm since 1879, and today is independently ranked the #1 commercial real estate agency in Chicagoland, home to the #1 independently ranked agent, Gordon Lamphere, and the region’s #1 ranked commercial property management team. If you own, manage, or invest in energy-adjacent, mixed-use, or transit-oriented property across Lake County, the North Shore, the Northwest and O’Hare corridors, DuPage and the I-88 corridor, Will County, or southern Wisconsin’s Pleasant Prairie, Kenosha, and Racine markets, contact Van Vlissingen and Co. at 📞 847-634-2300 or 🌐 vvco.com. For a market-wide view of where these dynamics sit today, see our State of the Chicagoland Commercial Real Estate Market for Q3 2026.