Tuesday, April 14, 2026
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Midwest Market Reports

IllinoisMarket ReportsMidwestMidwest Market ReportsOffice

Three Narratives Shaping Next Chapter of Chicago’s Office Market

by Kristin Harlow

By Denes Juhasz, NAI Hiffman Two different star performers are emerging in Chicago’s suburban and downtown office markets. Practical Class B properties are gaining traction in the suburbs, while glitzy Class A+ trophy towers continue to outperform downtown. As the office sector adapts to post-pandemic workplace realities, the 278 million-square-foot metro Chicago office market ended 2025 with a 25.5 percent overall vacancy rate and 1.8 million square feet of negative net absorption.  The suburban market closed 2025 with positive net absorption totaling 282,285 square feet, while overall vacancy held steady at 26.2 percent, largely consistent with the year-end 2024 level of 26.3 percent. Downtown, tenant space reductions and relocations continued to take a toll, with nearly 2.1 million square feet of negative net absorption recorded in 2025. Vacancy rose to 24.9 percent, up from 23.6 percent at year-end 2024. Well-performing assets and a reduction in inventory are helping stabilize the market, albeit unevenly. Three distinct trends are emerging: an outperformance of well-positioned Class B suburban properties, a continued flight to trophy assets in the central business district (CBD) and the conversion of obsolete buildings to alternative uses across the region. Rise of suburban Class B One of the most notable …

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IllinoisMarket ReportsMidwestMidwest Market ReportsMultifamily

Chicago Market Is Steadfast on the Performance Leaderboard

by Kristin Harlow

By Shubhra Jha, Standard Real Estate Investments Chicago was not on many investors’ bingo cards. However, consistently popping up in the top five apartment markets nationwide for rent growth and occupancy outperformance is changing that perception.  Metro Chicago boasts relative affordability compared with its coastal counterparts, a range of job opportunities at all skill levels and the ongoing need for attainable housing. These factors create a multifamily investment landscape poised to deliver steady, long-term returns driven by resilient and stable demand. Economy, affordability Chicago is a diversified and consistent economic powerhouse, counted as the third largest major metro area in the United States and the largest non-coastal city. Its geographic location in America’s heartland combined with its historic strength in a wide array of sectors ranging from agriculture/food processing and finance/commodities trading to manufacturing, transportation/logistics and education play an important role in the metro’s resilience throughout economic cycles. Notably, there is no singular industry dominating the economy.  Looking ahead, sizeable investments in quantum computing, life sciences and fintech will build on Chicago’s historic advantages in finance, trading and education. Despite its diversified and steadily expanding economic base, Chicago remains an affordable city for its residents. Median home prices in the …

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IndianaIndustrialMarket ReportsMidwestMidwest Market Reports

Indianapolis Industrial Market: From Resilience to Resurgence in 2026

by Kristin Harlow

By Abigail Sievers, JLL The Indianapolis industrial market is entering 2026 not merely recovering but evolving. What began as a “quiet” shift has matured into a definitive new phase of activity characterized by renewed user confidence, disciplined development and a manufacturing ecosystem that’s gaining national attention.  While headlines often focus on coastal or larger Midwest markets, Indianapolis is steadily emerging as a strategic center for large-scale industrial investment, offering the rare trifecta of scalable Class A space, a resilient workforce and the high-capacity infrastructure that modern manufacturers require. Mega deals return After more than two years of cautious expansion, the market is now seeing a resurgence of large industrial commitments. Leases and acquisitions exceeding 500,000 square feet — which had significantly slowed during the previous 24 months — are re-entering the landscape as users move forward with previously paused growth plans amid market uncertainty.  The broader leasing environment reflects this momentum. In fourth-quarter 2025 alone, Indianapolis recorded 7.2 million square feet of absorption — the strongest single‑quarter performance since the third quarter of 2021. Year‑to‑date absorption reached 13.1 million square feet, surpassing the previous two years combined. These mega deals confirm what we’re hearing daily from both new and existing …

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HospitalityIndianaMarket ReportsMidwestMidwest Market Reports

Indianapolis Lodging Edges Out National Trends

by Kristin Harlow

By Aghfar Arun, Bradford Allen Indianapolis has a reputation as a convention town, but its hotel story has moved well beyond lanyards and name badges. A growing mix of sports, healthcare, corporate and leisure demand is now filling rooms year‑round — downtown and across the suburbs — turning the market into one of the Midwest’s most reliable hospitality overachievers. Event boom downtown Indianapolis experienced 8.1 million room nights of demand in the 12-month period ending at mid-year 2025, according to CoStar data. This is over 580,000 more than the market’s pre-COVID peak.  To meet this demand, the construction pipeline at mid-year included more than 1,500 hotel rooms, with another 3,402 rooms in the final planning stages and 3,220 rooms proposed.  According to Visit Indy, new projects slated for delivery in 2026 include a pair of adaptive reuse projects: The Kimpton will transform the historic Odd Fellows Building into a 167-key luxury hotel and the Motto Hotel will bring 116 rooms to the King Cole Building. The most notable project is Signia by Hilton, a 38-story hotel with 800 guest rooms developed alongside a 143,500-square-foot expansion of the Indiana Convention Center.   A snapshot of downtown Indianapolis, prepared last year by …

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Market ReportsMichiganMidwestMidwest Market ReportsOffice

Flight to Quality, Slow Road to Reinvention Define Detroit’s Office Outlook

by Kristin Harlow

By Andy Gutman, Farbman Group The Detroit office market has moved past the initial shock of the post-pandemic years, but the idea that all challenges are over would be premature. Looking ahead in 2026, office in Detroit would be best described as stabilizing but still highly selective, shaped by a continued flight to quality, cautious capital markets and a growing emphasis on service and tenant experience.  While vacancy remains elevated compared with pre-pandemic norms, limited new construction and a clear bifurcation between high- and low-quality assets are helping prevent further deterioration. The next phase of the cycle will be defined by how effectively landlords adapt to tenant expectations and how long it takes for capital markets to allow older assets to meaningfully change hands. Detroit office in 2026 By the numbers, Detroit’s office market in 2026 shows stability without significant growth pressure. Vacancy estimates range from approximately 15.7 to 23.3 percent, depending on data source and asset class. Marcus & Millichap, for example, projects a 2026 year-end vacancy of roughly 15.7 percent, which is a modest 10-basis-point increase year-over-year. Broader datasets that include older inventory report vacancy closer to 23 percent. Asking rents have remained largely flat, with Class A …

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CivicHospitalityMarket ReportsMichiganMidwestMidwest Market ReportsMultifamilyOffice

Detroit Developments Showcase Urban Adaptive Reuse, Preservation

by Kristin Harlow

By Michael Poris, McIntosh Poris Architects Long defined by its industrial legacy, Detroit development currently combines ground-up construction with intelligent, innovative adaptive reuse. Brick-and-mortar manufacturing-era remnants include many buildings that originally served the automotive industry. As large-scale manufacturing relocated and Detroit’s population declined, several significant buildings were abandoned. Many are viable for second lives, ones that fulfill current commercial real estate market demands. Adaptive reuse makes sense I co-founded McIntosh Poris in 1994 to protect Detroit’s historic buildings from bulldozers and redesign them for a post-manufacturing economy. At that time, demolition was the most expedient option.  To address this, we focused as much on civic networking and preservation education as architectural design. Implementation involved organizing events with public officials and the local business community to meet leaders of other cities’ successful urban-renewal programs. To make Detroit more attractive to commercial real estate investment, we lobbied for zoning changes. Most relevant, commercial and historic districts were re-evaluated to permit mixed-use redevelopment. Historic preservation became viable, often making sense both financially and culturally. Well before sustainability became a commercial real estate consideration, we educated developers on available adaptive reuse incentives such as historic tax credits. Combined with the inherent efficiencies of reuse, …

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IndustrialMarket ReportsMichiganMidwestMidwest Market Reports

Return of the Spec: Metro Detroit’s Next Industrial Chapter

by Kristin Harlow

By Ryan Brittain, Colliers Speculative construction has always carried a certain boldness in industrial real estate. Building without a tenant can either signal visionary thinking or a bold bet on future demand.  In metro Detroit, that confidence was on full display during the post-COVID boom. To meet the surge in tenant demand, highly respected industrial developers raced to deliver modern distribution space across the region. At the height, preleasing was not always necessary but often occurred. Developers pushed forward on new Class A warehouses, confident that tenant requirements would catch up and, for a time, they did. Yet here we are in 2026, and speculative development is not an idea of the past. It is returning, this time with more discipline. This is not another Resurgit cineribus Detroit comeback story, but rather a thoughtful recalibration. The “Return of the Spec” reflects a market that has matured and learned, not one that has overheated. To understand it today, it helps to revisit how we arrived. As a wave of newly completed speculative projects delivered (at one point, the market saw 12 million square feet under construction), availability expanded. Shortly thereafter, the automotive industry hit an uncertain patch in late 2023. Vacancy …

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Market ReportsMidwestMidwest Market ReportsMissouriOffice

Prime Office Space in St. Louis: Scarcity and Strategy

by Kristin Harlow

By Joshua Allen and David Kelpe, JLL One year ago, CBRE Research forecasted a shortage of prime office space in Heartland Real Estate Business. That prediction has proven accurate. Since the beginning of 2025, demand for top-tier office space has continued to drive leasing activity across the region. This persistent appetite for quality has pushed prime Class A availability to record lows, creating a competitive environment for tenants and landlords alike. The St. Louis office market encompasses approximately 53 million square feet of competitive space. Yet, a closer look reveals a critical challenge: 73 percent of this inventory was constructed before the 1990s. This aging supply base means that only 2.6 million square feet qualifies as truly “prime” — the newest, most desirable assets located in walkable urban areas with abundant amenities. These buildings represent the gold standard for tenants seeking modern design, energy efficiency and proximity to vibrant neighborhoods. Currently, prime Class A availability sits at a mere 5.5 percent, a stark contrast to the 25.2 percent average for non-prime Class A assets. This gap reflects a clear and ongoing preference among tenants for buildings that combine high-quality construction with strategic location. In short, companies are willing to pay …

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Data CentersIndustrialMarket ReportsMidwestMidwest Market ReportsMissouri

Why Data Centers Are Emerging as a Defining Opportunity for the St. Louis Region

by Kristin Harlow

By David Steinbach, JLL As artificial intelligence (AI) acceleration, cloud expansion and high-performance computing reshape the digital economy, cities across the U.S. are reevaluating whether they can meaningfully compete for data center investment. St. Louis is increasingly part of that national conversation — and the reasons are structural, not speculative. With competitive power pricing, repurposable industrial infrastructure, developable land and a strengthening policy framework, the region is positioned to capture the next wave of large-scale digital infrastructure. This moment represents more than a real estate opportunity. It’s an inflection point that could redefine the region’s industrial future if public and private stakeholders act in alignment. Cost, infrastructure profile Data center site selection begins with power and connectivity, and St. Louis offers meaningful advantages on both. Missouri’s industrial electricity rates continue to trend below the national average, with the state at 7.69 cents per kilowatt-hour compared with the U.S. industrial average of 8.65 cents per kilowatt-hour, according to the latest EIA data.  This is a significant differentiator for large-scale campuses with substantial, long-duration energy needs. The region’s legacy industrial and former generation sites also come with high capacity transmission infrastructure that can be repurposed, reducing both development timelines and the cost …

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KansasMarket ReportsMidwestMidwest Market ReportsMissouriMultifamily

Multifamily Is Needed for All Income Levels in Kansas City

by Kristin Harlow

By Doug Stockman, Helix Architecture + Design Straddling two states, Kansas City is one of the country’s most distinctive real estate markets. Since 1992, our firm has designed workplace, cultural, higher education and multifamily projects of all types in the city, with specialized expertise in adaptive reuse. We see multifamily as the most active segment in 2026.  Compared with other states, Missouri’s support for new housing projects is about average. Kansas is near the bottom, because the state lacks the revenue to incentivize housing. Inventory on the Kansas side is also less, with most multifamily housing located outside the city. Looking ahead, low-income housing tax credit (LIHTC) incentives will ideally accelerate Kansas City’s biggest market demand — affordable housing. The Kansas City Affordable Housing Set-Aside Ordinance presents some obstacles. To receive city subsidies, multifamily developments must have 12 or more units, 20 percent of which need to be affordable for households earning 60 percent or less of the area median income (AMI). Alternately, developers can pay $100,000 into the city’s Affordable Housing Trust Fund.  Further, developers must navigate a complex process of zoning approvals and community engagement meetings that culminates with a city council hearing. If approved, developers on the Missouri …

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