Retail vacancy in Chicago’s central business district ticked down slightly in 2025 for the second year in a row, a bit of welcome news for an area that’s struggled with empty storefronts over the last several years.
The Loop retail vacancy rate was 28.53% in 2025, compared with 29.76% in 2024, according to a report from Chicago-based retail brokerage Stone Real Estate. The numbers show the market is getting back up after the “knockout punch” of the COVID-19 shutdown nearly six years ago, Stone Principal John Vance said.
“I do think that there’s been a bottom that has been hit,” Vance said.
Recent deals on the downtown market’s best-known but long vacancy-plagued corridor, State Street, show businesses that have already had a presence in the area are feeling good about their stores’ performance, he said, and give other retailers that may be considering a presence on the strip more confidence in its outlook.
A new Gap Factory store at 17 N. State St. and a lease from Barnes & Noble at 150 N. State St. helped the street chip away at its vacancy rate. Gap’s return to the strip after the company’s namesake apparel chain left State Street in 2017 shows a sister store, a Banana Republic Factory store at the Block 37 mall, must have been seeing decent sales even through the COVID-19 pandemic, Vance said. And the bookseller’s headline-grabbing deal — one of the largest leases State Street has seen in recent years — has other retailers intrigued, he said.
“That’s what momentum does, whether it be bad or good, and right now we’re got some good momentum,” he said.
Still, State Street lost retailers Saks Off Fifth and Anthropologie last year. Overall, the Central Loop submarket’s vacancy rate was 24.74% in 2025, compared with 26.02% in 2024.
Retail businesses in the Loop depend on office workers, who are slowly returning to in-person work, for a lot of their foot traffic. Office occupancy was a factor in a drop in retail vacancy in another Loop submarket, the LaSalle/Wacker corridor, according to the report. There, new leases from food and beverage spots at the base of well-capitalized office buildings included a butcher shop coming to 222. N LaSalle St. as well as fast casual restaurants Cava and Mendocino Farms opening in the base of Willis Tower in 2025. That submarket’s vacancy rate was 26.81%, down from 28.55%.
Restaurants that will appeal to tourists made up much of the leasing activity for the stretch of Michigan Avenue south of the Chicago River, with deals from local hot dog and Italian beef chain Portillo’s and a Hello Kitty-themed cafe at 360 N. Michigan Ave. Still, that corridor’s vacancy rate ticked up slightly to 27.81% because of the closure of a CVS pharmacy at 300 S. Michigan Ave.
By Rachel Herzog
Rachel Herzog is a commercial real estate reporter for Crain’s Chicago Business. She joined Crain’s in 2023 from The Real Deal, where she had covered commercial real estate in Chicago. Before that, Herzog wrote for the Arkansas Democrat-Gazette. She is a graduate of UNC-Chapel Hill, receiving a bachelor’s degree in media and journalism, as well as a separate degree in Hispanic literature and culture.