In its year-end Trendlines report, Cushman & Wakefield defined the Chicago-area industrial market as one continuing to face challenges but also one displaying resiliency.
New construction in the Chicago-area industrial market remained muted, while leasing activity was on the rise last year. Still, last year’s activity does not match the boom that the Chicago industrial market experienced during the years of the COVID pandemic.
As of the third quarter of 2025, new industrial leases over 250,000 square feet are up 26.7% compared to what was reported in the same quarter in 2024, underscoring the outsized share of big-box deals driving demand this year in the Chicago market.
New industrial leasing volume in the Chicago market was on track to surpass 2024 totals, too, driven by several large leases already signed in the fourth quarter and additional deals expected to close before the end of the year.
Despite this strong leasing activity, any industrial occupancy gains in the Chicago area were offset by 139 vacant availabilities for spaces of 100,000 square feet and greater that were added to the market this year.
As previously leased space is occupied in the upcoming quarters, absorption is expected to increase and stabilize. Currently, 9.8 million square feet of industrial space is under construction in the Chicago market, 6.7 million square feet of which is speculative.
New industrial construction in the Chicago market remains sluggish. Cushman & Wakefield said that there were 28 industrial construction starts in progress at the end of last year, 52% below the five-year historical average. Partly because of this new-construction slowdown, Cushman & Wakefield predicted that vacancy rates in the Chicago-area industrial market will remain low in 2026.
