Market Report
Chicago Retail Market Report
3Q 2026
Big-Box Drag Begins to Ease,
but Demand Recovery Remains Uneven
Vacancy remains resilient. Despite signs of caution, including last year’s decline in occupied space, the first since at least 2007, Chicago’s vacancy rate has stayed below 6 percent since late 2022. Contained supply risk, evidenced by 1 percent inventory growth over the past five years, has kept vacancy in check. The rate sat at 5.3 percent in mid-2026, just 50 basis points above its all-time low. Still, the post-pandemic in-migration surge has faded, with household formation turning negative in early 2026 for the first time in five years. Meanwhile, retail sales growth has moderated, as Chicago posted the fourth-slowest annual increase nationally at 2.4 percent in early 2026. Even so, stronger demand for formats under 10,000 square feet may continue to offset some big-box move-outs, helping moderate near-term vacancy growth.
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