Chicago – Oct. 29, 2019 – The Chicago tech market continues to expand, adding 4,582 jobs in 2017 and 2018 and occupancy grew by more than 4 million sq. ft. since last year, while serving as a top target for the expansion of firms from the San Francisco Bay Area, according to CBRE’s annual Tech-30 report. CBRE’s annual Tech-30 report measures the tech industry’s impact on office rents in the 30 leading technology markets in the U.S. and Canada.
Tech has become a significant player in the office market in Chicago as employment expanded 6.7% from 2017-2018, accounting for 39 percent of all new office workers added in this time period. Tech occupancy now accounts for 17.7 million sq. ft. of space in the CBD. Strong demand and limited “tech-preferred” inventory has driven rent growth, with Chicago office rents increasing 5.7 percent from Q2 2017 to Q2 2019. Chicago’s top tech submarket, River North, has a 32 percent rent premium from the overall market with average rent at $41.56.
In total, Chicago now has a high-tech industry of 73,127. This large concentration of tech workers has made Chicago a top expansion target for West Coast tech firms. Since 2013, San Francisco Bay Area firms have leased 2 million sq. ft. of space in the Chicago market.
“The Chicago tech community continues to expand at a steady rate,” said Brad Serot, vice chairman and member of CBRE’s Tech and Media Practice Group. “The city’s highly skilled workforce has attracted some of the world’s largest tech firms as they look to tap into the market’s immense talent at a much more affordable cost than coastal alternatives.”
CBRE’s analysis found that tech companies accounted for 21 percent of major office-leasing activity in the first half of this year, up from 11% when CBRE began tracking the figures in 2011. Strong leasing activity is fueled by the tech sector’s robust job growth, which even as it slowed to 4.5 percent in this year’s first half due to tight labor conditions, is still more than double the national job-growth rate. Vancouver and San Francisco had the fastest tech job growth in this year’s report.
“The North American tech industry has diversified its economic base as it has grown, expanding its presence in many Tech-30 markets,” said Colin Yasukochi, Executive Director for research for CBRE’s Tech and Media Practice and co-author of the report. “Meanwhile, large tech companies have been an ongoing source of demand; The 10 most active tech companies leasing office space since 2013 account for 27 percent of overall tech-industry leasing.”
To read the full report, click here.
Tech has become a significant player in the office market in Chicago as employment expanded 6.7% from 2017-2018, accounting for 39 percent of all new office workers added in this time period. Tech occupancy now accounts for 17.7 million sq. ft. of space in the CBD. Strong demand and limited “tech-preferred” inventory has driven rent growth, with Chicago office rents increasing 5.7 percent from Q2 2017 to Q2 2019. Chicago’s top tech submarket, River North, has a 32 percent rent premium from the overall market with average rent at $41.56.
In total, Chicago now has a high-tech industry of 73,127. This large concentration of tech workers has made Chicago a top expansion target for West Coast tech firms. Since 2013, San Francisco Bay Area firms have leased 2 million sq. ft. of space in the Chicago market.
“The Chicago tech community continues to expand at a steady rate,” said Brad Serot, vice chairman and member of CBRE’s Tech and Media Practice Group. “The city’s highly skilled workforce has attracted some of the world’s largest tech firms as they look to tap into the market’s immense talent at a much more affordable cost than coastal alternatives.”
CBRE’s analysis found that tech companies accounted for 21 percent of major office-leasing activity in the first half of this year, up from 11% when CBRE began tracking the figures in 2011. Strong leasing activity is fueled by the tech sector’s robust job growth, which even as it slowed to 4.5 percent in this year’s first half due to tight labor conditions, is still more than double the national job-growth rate. Vancouver and San Francisco had the fastest tech job growth in this year’s report.
“The North American tech industry has diversified its economic base as it has grown, expanding its presence in many Tech-30 markets,” said Colin Yasukochi, Executive Director for research for CBRE’s Tech and Media Practice and co-author of the report. “Meanwhile, large tech companies have been an ongoing source of demand; The 10 most active tech companies leasing office space since 2013 account for 27 percent of overall tech-industry leasing.”
To read the full report, click here.
About CBRE Group, Inc.
CBRE Group, Inc. (NYSE: CBRE), a Fortune 500 and S&P 500 company headquartered in Dallas, is the world’s largest commercial real estate services and investment firm (based on 2020 revenue). The company has more than 100,000 employees serving clients in more than 100 countries. CBRE serves a diverse range of clients with an integrated suite of services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.
CBRE Group, Inc. (NYSE: CBRE), a Fortune 500 and S&P 500 company headquartered in Dallas, is the world’s largest commercial real estate services and investment firm (based on 2020 revenue). The company has more than 100,000 employees serving clients in more than 100 countries. CBRE serves a diverse range of clients with an integrated suite of services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.
