Chicago Industrial Review: Steel-ing the Spotlight
Chicago is not only the largest city in the Midwest; it is also a powerhouse of economic and industrial activity, ranking as the third most populous city in the United States. The Chicago metropolitan area boasts an impressive population of 9.3 million, providing a substantial and skilled workforce. The Chicago Metropolitan Statistical Area (MSA) has the third-largest workforce in the country, with 4.7 million workers1. Of this workforce, approximately 8.9%, or 419,000 individuals, are employed in manufacturing, highlighting the city's industrial strength.
Chicago's connectivity is unparalleled, making it a crucial hub for both national and international logistics and trade. The metro area includes all six Class I railroads, facilitating seamless service across the U.S., Canada, and Mexico2. Illinois ranks third in the nation for interstate miles3, offering exceptional highway connectivity. Additionally, the Chicago is served by two major airports. Chicago O'Hare International Airport is the 6th busiest cargo airport in the U.S.4, and Chicago Midway International Airport is another significant aviation hub ensuring efficient air transport.
Chicago is a center for higher education with numerous renowned universities, including the University of Illinois Chicago, The University of Chicago, DePaul University, Loyola University Chicago, and Northwestern University. These institutions provide a steady stream of talent and innovation, contributing significantly to the city’s economic vitality.
Chicago leads the nation with the largest industrial inventory, totaling 1.4 billion square feet out of the U.S.’s 19 billion square feet5. Despite this vast inventory, the city maintains a low industrial vacancy rate of 5.4%, which is a full 100 basis points below the national average of 6.4%. Furthermore, the market's year-over-year asking rent growth stands at around 5%, outperforming the national average of 4.5%.
Chicago is a major hub for manufacturing, with significant contributions from the metal fabrication and machinery sectors. Food processing is another critical industry, leveraging Chicago's strategic location and transportation infrastructure to supply both national and international markets. The chemicals and pharmaceuticals industry also plays a vital role, supported by the city's strong research institutions and skilled workforce. Additionally, the transportation equipment sector, including automotive and aerospace components, is a significant contributor to Chicago's industrial output. These industries collectively underpin Chicago's economic strength, ensuring its position as a leading industrial powerhouse in the United States.
Our Role
Legacy West Partners recently acquired an approximately 83,000 square foot industrial facility in Broadview, IL, a village in the Chicago market. The property is centrally located within a mile of I-290 and approximately seven miles from both Chicago O’Hare International Airport and Chicago Midway International Airport. Our partners secured a brand-new 20-year NNN lease with 2% annual increases upon close of escrow. The tenant, Central Steel Fabricators, is a highly regarded manufacturer of specialized fabricated metal products primarily for the communications industry. Broadview itself boasts an industrial vacancy rate of just 1.2% and a market asking rent growth of 5.4%5, reflecting the area's strong demand.
For more information on our recent acquisition, read our Special Edition.