Monday Market Moves | Week of 12 May 2025
Welcome to Monday Market Moves, the weekly series from Essex Capital Markets briefing you on Chicago commercial real estate capital markets. We cover key trends in CRE debt, refinancing, and capital structures to help investors, borrowers, and lenders navigate today’s evolving environment.
At Essex Capital Markets, we remain attuned to the constantly shifting landscape of commercial real estate. Across asset classes, conversations are increasingly shaped by pricing adjustments, mounting distress, and the emergence of innovative capital stack solutions. In the face of uncertainty, discerning investors are staying engaged—choosing action over retreat.
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Here’s what we’re tracking this week:
The U.S. office sector recorded its fourth consecutive quarter of positive net absorption—2.3M SF in Q1—with leasing activity up 18% YoY. Class A assets continue to outperform, with vacancy dipping to 14.8%.
Source: CBRE Q1 2025 U.S. Office Figures
In Chicago, downtown recorded +66,000 SF of positive absorption—its first since Q2 2023—as tenants like Kirkland & Ellis expanded at Salesforce Tower.
Source: CBRE Chicago Downtown Office Figures Q1 2025
Suburban momentum followed suit, with +216,352 SF of net absorption and vacancy trending downward to 26.3%.
Source: Hiffman Q1 2025 Office Report
National industrial vacancy rose to 7.1%—its highest since 2015—as completions outpaced demand. However, new construction starts have plummeted, suggesting equilibrium is ahead.
Source: Colliers U.S. Industrial Market Statistics Q1 2025
In Chicago, vacancy nudged up to 5.4% with 8.6M SF leased in Q1. Absorption slowed to 3.5M SF, but rents rose to $9.20/SF, and new supply is tapering.
Source: Hiffman Industrial Report Q1 2025
U.S. advertised rents climbed to $1,736, up 0.9% YoY, with occupancy dipping to 94.4% amid elevated new deliveries.
Source: Yardi Matrix April 2025 Multifamily Report
In Chicago, occupancy is holding at 95.6%—one of the nation’s highest—with YoY rent growth of 3.3%. Rent increases are projected to top 4.3% for the year due to muted construction.
Source: MMG Real Estate Advisors Chicago Q1 2025 Report
Chicago’s retail scene continues to rebuild. Warner Bros. is launching a 12,000 SF Harry Potter-themed retail and event space at 676 N. Michigan Avenue this month, marking a bold step in revitalizing the Mag Mile.
Source: Crain’s Chicago: Harry Potter Store Opening
According to Penske’s newly released 2024 Top Moving Destinations list, Chicago reentered the top 10 for the first time since 2021—ranking #8 among U.S. cities for one-way truck rentals.
Source: Penske 2024 Top Moving Destinations Report
Their national relocation survey found that 82% of movers saw their move as a fresh start, and more than half moved for a stronger sense of community. This return to Chicago suggests a growing belief in urban renewal, career opportunity, and lifestyle appeal.
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Multifamily: Q1 investment hit $30B (+7% YoY), with single-asset deals up 39%. Cap rates held at 5.7%.
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Office: $10.1B in U.S. office transactions (+48% YoY), with avg. pricing up 13.7% to $181/SF.
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Capital Raising: Brookfield raised $16B for a distressed-asset fund, anticipating accelerated deal flow in H2 2025.
Source:WSJ: Brookfield Real Estate Fund
What We’re Seeing
Sponsors and investors aren’t sitting still. They’re recapitalizing, structuring with creativity, and preparing to move fast when the right deal hits the table.
If you’re planning a refi, sourcing equity, or navigating a maturing loan—we’re here to help.
To speak with our Capital Markets team about structuring seller financing multifamily deals, please fill out the form below.