Chicago Loop retail vacancy rate on decline

By Glenn Minnis | The Center Square contributor
The Center Square

(The Center Square) – Chicago Loop Alliance President Michael Edwards argues change is good when it comes to the new downtown area he sees emerging after the corridor’s ongoing post-COVID struggles.

New data shows Loop area retail vacancies ticked down in 2025, marking the second straight year of such development and giving raised hope to some that things may finally be settling.

The Loop retail vacancy rate in 2025 fixated at 28.53%, down from 29.76% the year before as the State Street area welcomed a Gap Factory Store, Panera Bread and a Barnes & Noble.

“In the last quarter we had 2 million people come down to enjoy largely arts and cultural amenities in The Loop, which is kind of our secret sauce” Edwards told The Center Square. “That’s going to continue to drive more investment in storefronts. The people are coming back on public transportation, which would indicate that more people are coming downtown, spending more money, spending more time.”

Edwards adds all the changes are easy to see.

“We’re not going to be a 9 to 5 predominantly office market,” he said. “There’s 45,000 people living in The Loop. There are all these visitors coming down for arts and culture. We are a national tourist destination. We have new amenities like the Riverwalk and of course the lakefront. There’s lots of reasons to come downtown; it’s not just a 9-to-5 job. The Loop is for everybody and for every reason.”

New restaurants across the area are also designed to appeal to tourists, with a Portillo’s and Hello-Kitty themed café among them.

“Cities like Chicago are all doing whatever they can to accelerate the market and I think maybe 70% of this is just property owners deciding to do something with their building, or employers deciding that their employees have to come back to the office, or a restaurant just saying I’m going to take a chance,” said Edwards. “We’re going to be announcing programs to assist folks with some storefront renovations so there’s kind of a mix, but I would say it’s largely the market is finally coming back to State Street.”

With the flow of area office workers also on the rise, Edwards adds sharp increases in foot traffic are also making a difference.