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“It's certainly bad news for taxpayers because as these property
values go down in the big office properties, that means the
property tax bills are going to grow higher for residential,”
Dabrowski told The Center Square as the vacancy rates are up
nearly 14% since the start of the COVID-19 pandemic. “Maybe
there's a few positive signs in the numbers for downtown, but
overall it still spells big trouble.”
Real estate firm CBRE now pegs the area’s overall vacancy rate
at 26.5%, and estimates that the city’s central business
district is occupying as much as 2.1 million less square feet
than it did just a few years ago. As a result, neighborhood foot
traffic continues to remain only a fraction of what it once was,
meaning that local business that remain downtown see fewer
customers.
Through it all, Dabrowski said he can envision a brighter future
provided city leaders are open to changing direction.
“Number one is always just remove red tape, make it easy for
companies to move in,” he said. “Number two is you got to get
rid of these pension debts. As long as these taxes keep going
up, it's going to be harder for companies to move in.”
Dabrowski said another issue city leaders need to address is
crime.
“Yes, it's down from the highs of the George Floyd days, but
we're still the highest murder rate in the country for big
cities,” he said. “All those things add up and we have to be
really careful with our policies in Chicago and whatever
politicians do, they should be reducing the burdens to come into
downtown.”
Dabrowski said he sees just one way for the city to resemble
what he argues it should look like.
“I think it takes a change in leadership because both the mayor
and the governor want higher taxes; they support bigger
governments; they are soft on crime,” he said. “As long as that
continues, I think Chicago's going to struggle. We need a
complete turnaround in the kind of policies we have in order to
bring life back.”
Researchers note that owners of newer and updated buildings are
generally having an easier time getting leases signed than
others, with vacancy rates among top-tier, or Class A, office
buildings downtown just under 21%, compared with a 32% vacancy
rate among Class B buildings.
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