The Metro Chicago economy showed signs of life during the spring, with monthly employment beginning to rise in March (up 21,700, followed by a gain in April of 43,500).  And 12-month employment losses are easing, at 101,400 jobs – a 2.4% decline – over the 12 months ending April 2010.  This compares to a 1.1% decline nationally.  The Education/Health Services sector has continued to buoy the region’s economy, with a gain of 12,000 jobs – up 1.9% – during the past year.  The Professional/Business Services sector, a significant component of the region’s economy, lost 22,600 jobs – down 3.4% – over the past 12 months.

The Metro Chicago unemployment rate dropped to 10.7% in April 2010, from 11.7% in January, but is up from 9.7% a year earlier.  The national unemployment rate was 9.9% in April 2010, up from 8.9% a year earlier; it declined to 9.7% in May.

• Net absorption: Negative 190,000 SF during the 2nd quarter 2010, and negative 528,000 SF YTD.
• Overall vacancy rate: 15.7% in the 2nd quarter 2010, up from 15.3% in the 1st quarter.
• Rents: CBD Class A asking rents were down 1.6% and Suburban Class A asking rents were flat in the 1st half of 2010.
• Under construction or renovation: 695,589 SF of office space (all in Suburban Chicago) at mid-year 2010, down from 1.8 million SF in the 1st quarter and 3.6 million SF a year ago.
• Deliveries: 800,000 SF was delivered in the CBD in the 2nd quarter of 2010.  Suburban Chicago deliveries totaled 1 million SF in the 1st half of 2010, compared to 529,000 SF in the 1st half of 2009.
• Office investment sales volume: Totaled $322 million in Metro Chicago during the 1st half of 2010, compared to $363 million in the 1st half of 2009.  Sales prices averaged $100/SF in Metro Chicago in the 1st half of 2010, compared to $145/SF in all of 2009.

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• The Metro Chicago industrial market experienced negative 1.6 million SF of net absorption in the 2nd quarter of 2010, and negative 1.4 million SF YTD.  All of the reduction in the 2nd quarter occurred in Warehouse/Distribution space, while Manufacturing and Flex/Service space experienced modest expansion.
• There is currently 6.3 million SF of sublease space on the market at mid-year 2010, up from 5.9 million SF last quarter and 5.7 million SF a year ago.  Sublease space represents 0.6% of standing inventory.
• The overall industrial vacancy rate in Metro Chicago rose to 11.8% at mid-year 2010, from 11.6% in the 1st quarter and 10.9% a year ago.  The direct vacancy rate was 11.2% at June 2010, up from 11.0% in March and 10.4% a year ago.
• There is 325,000 SF of industrial space under construction in Metro Chicago at mid-year 2010, down from 1.3 million SF a year ago.  Space under construction at June 2010 is 28% pre-leased.
• Industrial deliveries totaled 279,000 SF in Metro Chicago during the 1st half of 2010, down from 6.9 million SF in the 1st half of 2009.  Space delivered in the 1st half of 2010 was fully-leased at delivery.
• Industrial asking rents decreased 4.0% in the 1st half of 2010, compared to a decline of 6.0% in all of 2009.   Overall industrial rents averaged $4.60/SF, NNN, at mid-year 2010.
• Industrial investment sales totaled $108 million in Metro Chicago in the 1st half of 2010, down from $227 million in the 1st half of 2009.  Sales prices averaged $38/SF in the 1st half of 2010, compared to $58/SF in the 1st half of 2009.