Chicago’s Downtown: Dead or Alive?

LaSalle Street is deserted. A post-pandemic norm

Though the pandemic is waning, downtown Chicago remains semi-comatose.  On a Monday at mid-day, the financial district was empty except for a handful of pedestrians.  Absent were the Ubers, trucks, and cabs usually clogging this part of town.  South LaSalle Street, which has been in decline since the Chicago Board of Trade (center) closed its trading floors, is even more of a ghost town than before.

How sound are the balance sheets of these massive commercial buildings?  The Real Deal reports that, by the end of 2020, the vacancy rate in Chicago’s central business district had climbed to a “grim” level of 14.2 percent, with 148.2 million square feet of unrented office space.  Meanwhile, businesses still holding leases tried to reduce their obligations by offering to sublease 5.4 million square feet of vacant space, a 93-percent increase over 2019.

Commercial real estate broker MBRE reports that the vacancy rate has since increased to 15.36 percent at the end of March, 2021.  When the sublease space is thrown in, the total rate of surplus office space comes to 19.20 percent.  (Office vacancy in the Chicago suburbs has been rising, too.)

With so few Chicagoans commuting downtown, and tourism at a standstill, entities that provide ancillary goods and services are languishing.  It’s eerie seeing so few people on this particular stretch of Adams.  Normally, people would be strolling toward the Art Institute (center), going for lunch at the Revival Food Hall (left), or doing business at the Federal Court Buildings and Post Office (right).

In-person activity in the vicinity of the Federal Court remains subdued.  Chicago’s downtown, while paralyzed by COVID, was also gravely injured by the opportunistic violence perpetrated during the summer of 2020.  Many businesses went under in the wake of the looting and the trauma; others, though solvent, remain indefinitely closed for want of custom.  Some storefront businesses, like the Intelligentsia in the Monadnock Building (center), stand poised to reopen should their former clientele materialize.

Given the relative expense of doing business in Chicago and prevailing wait-and-see atmosphere, it’s doubtful when the city will wake up and regain its health.

2 responses

  1. Geez, that’s one very unsettling post. I’ve lived all my days in Chicago and never, ever seen its downtown so void of people. Many people have described it to me as a ghost town. Almost everyone I do business with is still working from home. Some go to their offices once or twice a month to collect mail, but that’s it.

    Will downtown “come back”? I say yes, but it will be a slow process. Probably 95% of folks who worked there were commuters; the other lucky 5% could safely walk to work or bike there. When will confidence return when it comes to transportation: buses, trains, cabs, ubers, etc.? All risky to some extent, as are offices, elevators, shared bathrooms, and so forth.

    I’ve read that now somewhat over 293 million of us have had at least one poke in the arm; that’s a VERY large percentage of the population. Thankfully this is registered in the caseloads dropping significantly over the last 5-6 weeks.

    Next, people must overcome their fear, and that’s tough to do. We’ve been in the habit of taking extreme care to avoid exposure to COVID since mid-March 2020.

    So, downtown should come back as we embrace confidence that the vaccines will protect us, while overcoming any fear that they won’t. A timetable for that has yet to be determined.

    Meanwhile, we must all keep our fingers crossed that some covid variant won’t emerge that the vaccines can’t handle. If that were to happen, recovery would take a colossal step backwards.

    • I think you’re right, though I don’t think the volume of new businesses that might come to the Loop will offset all those that have gone out of business or chosen to leave. And many employers and employees have gotten used to working remotely–companies have realized that if they tolerate remote work, the sky won’t fall.

      So, it’s possible that many downtown entities will operate on a hybrid model, with many fewer employees working downtown full-time. Even now, stores are open fewer hours than before, because the office workers who patronize them aren’t entirely back, and may never be.

      Talking with shopkeepers downtown brings home to me the civic good each of us can do by spending as much money as possible at local businesses, many of which desperately need our patronage now.