Chicago’s commercial real estate market has spent the last several years navigating economic uncertainty, shifting workplace habits and changing consumer preferences. But according to JLL‘s newly released 2026 Big Bets report, the region could be entering a period of renewed momentum across multiple property sectors.
The report outlines five predictions for the Chicago-area CRE market
One of the report’s most notable forecasts is a resurgence in downtown office leasing activity. JLL projects that office leasing volume in Chicago’s central business district will reach 8.5 million square feet this year, a 10% increase from a year earlier.
The growth is being fueled in part by a rising number of lease expirations. According to JLL, more tenants are waiting until the year their leases expire before making relocation or renewal decisions. Since 2022, about 20% of tenants have signed their next lease during the same year their current lease expires, up from 14% before the COVID-19 pandemic.
That trend is accelerating leasing activity and compressing decision timelines throughout the market.
Downtown landlords may also gain leverage because of another unusual market condition: the complete absence of planned new office construction.
JLL reports that no new office developments are currently planned for Chicago’s central business district, marking the first such pause in more than a decade. Historically, similar development slowdowns have resulted in lower vacancy rates, higher rents and reduced concession packages.
The company forecasts that vacancy in top-tier downtown office buildings will decline by 3.7 percentage points through 2030. Well-located, amenity-rich Class-A buildings developed between 2000 and 2014 are expected to see vacancy rates decline by nearly as much.
Chicago’s multifamily sector also continues to rank among the strongest in the country. Urban apartment occupancy reached 96.1% in the fourth quarter of 2025, a 10-year high. Effective rents increased 5.6% year-over-year, trailing only San Francisco among major U.S. markets.
In its report, JLL said that home values also posted impressive gains. According to the Case-Shiller Index, Chicago-area residential property values increased 5.34% in 2025, the highest growth rate among major U.S. metropolitan areas.
The firm’s report highlights a collection of 20 neighborhoods anchored by Lincoln Park, West Town, Lakeview and the Near North Side as a key growth zone. Together, these neighborhoods are home to about 841,000 residents, with population growth expected to continue through the end of the decade.
The broader Chicago economy is also positioned for expansion, according to JLL. The report forecasts economic growth of 4% to 5% in 2026, supported by foreign direct investment and several major development projects. Among the largest are the Illinois Quantum and Microelectronics Park, The 78, the 1901 Project, the O’Hare Modernization Program and Bally’s Chicago’s casino development.
Collectively, these projects represent nearly $30 billion in investment and are expected to generate more than 14,000 construction jobs.
Meanwhile, Chicago’s suburban office market continues to evolve through adaptive reuse. JLL reports that suburban office inventory has already fallen 8.4% from its 2017 peak and could shrink to levels last seen in 2002 by the early 2030s.
Much of the space is being converted into housing, warehouses and data centers rather than remaining traditional office product. Despite the shrinking inventory, suburban leasing activity remains resilient, with annual leasing volume projected to exceed 4.3 million square feet for a fifth consecutive year.
