Chicago Retail Market Report

Chicago’s vacancy hits record low as construction slows. Chicago’s retail vacancy rate dropped to a new low of 5.1 percent in mid-2024, marking seven consecutive quarters of decline that each set new records. Prior to this streak, the lowest vacancy rate was 5.9 percent in 2018. This market tightness is primarily the result of a significant reduction in construction since 2020, in conjunction with the increase in cost and the decline in construction financing availability. In 2023 alone, completions were down nearly 80 percent from the long-term average, and projections indicate an even further decrease this year. Redevelopment efforts — such as converting obsolete mall spaces into multifamily units — have also helped tighten market conditions, contributing to the low vacancy rates. Still, some major construction projects are being planned, including the proposed $7 billion expansion of the United Center, which will add housing, retail, entertainment and public open spaces.