Last year won’t go down as a boom year for the Chicago-area industrial market. But the Chicago region still ended the year with a low vacancy rate and more than 18 million square feet of positive industrial absorption.
That’s the highlight of NAI Hiffman’s recently released fourth quarter 2025 Metropolitan Chicago Industrial Report.
According to NAI Hiffman’s research, the Chicago metropolitan area industrial sector ended 2025 with a total vacancy rate of 6% and saw more than 18.7 million square feet of net absorption during the year.
The lowest vacancy rates came in DeKalb County, where the industrial market ended 2025 with a vacancy rate of 2.2%; Central DuPage, 2.5%; the Interstate-57/Will County corridor, 2.9%; and McHenry County, 1.1%.
In the fourth quarter of last year, the Chicago industrial market posted 7.9 million square feet of positive net absorption, NAI Hiffman reported. That was a slight increase from the 7.5 million square feet of positive net absorption the sector saw in the third quarter of last year.
The market’s year-end positive absorption rate of 18.7 million square feet is an improvement over 2024’s 12.2 million square feet of positive absorption.
Leasing activity held steady at 10.3 million square feet in the fourth quarter of 2025, according to NAI Hiffman, up from 9.7 million square feet in the previous quarter. Year-end new industrial leasing volume hit 43 million square feet in 2025 in the metropolitan Chicago area, NAI Hiffman said.
What’s interesting is that the average industrial deal size declined compared to the same period in 2024. After reaching an all-time high of 81.1 million square feet of annual new leases in 2021, the overall leasing velocity in the Chicago area has gradually cooled, NAI Hiffman said.
Build-to-suit developments again overtook the amount of speculative development, with 53.5% of industrial space under construction here built with a committed tenant.
The Chicago area saw some significant industrial transactions in the fourth quarter of last year. NAI Hiffman pointed to the 1.3-million-square-foot new lease by Goodyear at Peace Road and Fairview Road in DeKalb and the 1.209-million-square-foot new lease by RJW Logistics in Plainfield.
NAI Hiffman reported that construction activity picked up across the Chicago area in the fourth quarter of last year, with developers delivering 3.9 million square feet of new space, a jump from the 575,466 square feet that came online in the third quarter of 2025.
Even with that late-year surge, though, overall development slowed on an annual basis, with total completions reaching 11.3 million square feet by year’s end, down from the 15.9 million square feet delivered during the same period in 2024.
