Is it Time to Start Building Office Yet?

Last Updated: June 20, 2012 07:19am ET

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Hines' River Point is the only large spec office in Chicago today.

CHICAGO-New construction is late. This is now the third year of the US economic recovery, and new non-residential development is traditionally supposed to trail a recovery by 18-24 months. The construction industry is still dragging feet, with only about a third of the expected jobs by this time in a recovery cycle.

There is some movement multifamily, taking advantage of the switch from home owning to renting, is seeing a lot of new starts. Theres also cranes in the air for office in the core markets of New York City, Washington, DC, San Francisco, Houston and even Seattle. But for the rest of the country, companies are still holding back on agreements to start new office buildings.

According to experts, many large markets, such as Chicago, today have the large block demand for around four new office buildings, but are seeing one building announced or nothing. In Chicago, only Hines $300 million River Point project in the River North area is moving forward, having finally closed financing with partner Ivanhoe Cambridge after a few failed starts since 2008.

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Is it Time to Start Building Office Yet?