Chicago’s Real Estate Market Features Limited Supply, Increased Demand

​Chicago’s real estate market is dynamic and showing signs of renewed activity. As reported in the Chicago Business Journal, the private investors who have dominated the market since the pandemic have given way to institutional investors. In the latter half of 2024, large deals in the $50 million to $200 million range were more frequent, with stronger bidding pools.

A major factor is the limited supply of new housing, with the urban area having the least new unit supply of any major market nationwide. This scarcity will remain a significant factor in demand and pricing for at least the next 18 months. This is drawing investor interest in existing multifamily housing stock, as well as planned developments.

Chicago features the nation's second-largest volume of retail inventory, with more than 95 percent of space occupied as of mid-2024. With few new retail properties under construction, demand for existing space will be high for the foreseeable future. Industrial properties are also witnessing an uptick as major companies such as data centers, third-party logistics providers, and EV battery manufacturers set up operations in Chicagoland.

Robert Palley

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