Chicago's Industrial Construction Sector Slows Down
Chicago’s industrial construction sector is experiencing a slowdown, but this could be beneficial for the market's long-term resilience.
Developers are now more cautious, carefully weighing each project and balancing financial hurdles with the changing demands of tenants.
“While there are some things happening around the greater Chicago area, activity is well below the levels we’ve seen in recent years,” said Trevor Ryor, vice president of industrial at Clayco.
Ryor notes that larger build-to-suit deals are moving slowly, with a longer lead time before breaking ground, and most builds are smaller infill sites with buildings less than 100,000 square feet.
This shift towards smaller projects is a result of the market adapting to higher interest rates and limited access to capital, with developers focusing on infill and suburban submarkets with reliable demand.
Author's summary: Chicago's industrial construction sector slows down.