Chicago Real Estate Office Rents Among Nation’s Highest

December 11, 2011

The commercial Chicago real estate market is one of the most expensive in the country.

The Building Owners and Managers Association (BOMA) International has released the 2011 Experience Exchange Report, which ranks the United State’s most expensive commercial real estate markets.

Chicago rounded out the top 10.

Each year, the report provides analysis of office building operating income and expense data compiled across approximately 940 million square feet of commercial office space throughout more than 6,500 buildings in 278 different markets. The 2011 report is based on operating income and expenses from 2010.

In terms of expenses based on total rental income, which includes rental income from office, retail, storage and other space, Chicago is the tenth most expensive commercial real estate market at $25.20 per square foot (psf).

New York City was the most expensive at $48.27 psf.

The top 10 most expensive commercial real estate markets:

1. New York, N.Y., $48.27 per square foot (psf)

2. Washington, D.C., $42.63 psf

3. San Mateo, Calif., $41.61 psf

4. Santa Monica, Calif., $36.67 psf

5. San Francisco, Calif., $34.86 psf

6. Boston, Mass., $31.15 psf

7. San Jose, Calif., $30.35 psf

8. Los Angeles, Calif., $27.97 psf

9. West Palm Beach, Fla., $27.71 psf

10. Chicago, Ill., $25.20 psf

BOMA also lists the most expensive U.S. cities based on total operating and fixed expenses.

New York City again led the pack at $21.44 psf. Chicago tied at ninth with Los Angeles at 12.49 psf.

The top 10:

1. New York, N.Y., $21.44 psf

2. Washington, D.C., $16.86 psf

3. Boston, Mass., $15.16 psf

4. Morristown, N.J., $14.67 psf

5. San Francisco, Calif., $14.43 psf

6. Miami, Fla., $12.87 psf

7. Santa Monica, Calif., $12.84 psf

8. Plainfield, N.J., $12.83 psf

9. Chicago, Ill. and Los Angeles, Calif., 12.49 psf

10. Newark, N.J., $12.46 psf

How about the flip side? BOMA also lists the country’s least expensive commercial markets, but you won’t find Chicago real estate or any Illinois market on there.

The least expensive U.S. cities, based on total rental income:

1. Shreveport, La., $10.47 per square foot (psf)

2. Nashville, Tenn., $13.31 psf

3. Tulsa, Okla., $13.73 psf

4. Dayton, Ohio, $13.97 psf

5. Columbus, Ohio, $13.99 psf

6. Boise, Idaho, $14.64 psf

7. Omaha, Neb., $15.23 psf

8. Harrisburg, Pa., $15.45 psf

9. Oklahoma City, Okla., $15.78 psf

10. Jacksonville, Fla., $15.90 psf

Finally, the top 10 least expensive cities based on total operating and fixed expenses:

1. Fresno, Calif., $4.25 psf

2. Jackson, Miss., $4.97 psf

3. Baton Rouge, La., $5.48 psf

4. Virginia Beach, Va., $6.20 psf

5. Everett, Wash., $6.36 psf

6. Little Rock, Ark., $6.59 psf

7. Oklahoma City, Okla., $6.66 psf

8. Salt Lake City, Utah, $6.68 psf

9. Raleigh, N.C., $7.00 psf

10. Norfolk, Va., $7.20 psf

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