1. CBRE RESEARCH
// TECH BOOK CHICAGO //
2016

2. //Table of Contents
01. Executive Summary
02. Tech Footprint
Tech Submarket Snapshots: River North
Tech Submarket Snapshots: West Loop
Tech Submarket Snapshots: Central Loop
Development Pipeline: Fulton Market
Development Pipeline: Goose Island
03. Office Market
04. Tech Talent
05. Tech Industry Indicators
06. Industry Outlook

4. TECHBOOK CHICAGO 2016 EXECUTIVE SUMMARY// 4
TECH INDUSTRY DEFINITION
INDUSTRY CATEGORIES INCLUDE:
FINTECH
E-COMMERCE
COMPUTER SYSTEM, DESIGN
AND RELATED SERVICES
TELECOMMUNICATIONS
ADVERTISING/PR/MEDIA/DIGITAL
COMPUTER/ELECTRONIC PRODUCTS,
ELECTRICAL EQUIPMENT AND COMPONENT
MANUFACTURERS
SOFTWARE
WEB SEARCH PORTALS
Executive Summary
01
4 // © 2016 CBRE, INC.

5. TECHBOOK CHICAGO 2016 EXECUTIVE SUMMARY// 5
TECH DEMAND FOR SPACE RISING
6.8M SF
Total space leased by tech tenants since 2011.
Most active year was 2015 at 23.8% of
overall leasing activity in the CBD
GROWING SPACE REQUIREMENTS
50-100K SF
Tech space requirements have gotten much larger,
as tenants in the market between 50,000 and
100,000 sq. ft. more than doubled,
up to 37% from 15% in 2014
OFFICE MARKET
Fulton Market and Goose Island office submarkets developing around
major tech users that are transforming the landscape
FUNDAMENTAL DRIVER IN
LOCAL ECONOMY
22.6%
Growth in Tech sector
employment since 2010
LOCAL FUNDING ALLOWING
COMPANIES TO STAY AND
GROW IN CHICAGO
$1.7 B
Invested in Chicago
startups in 2015
VIABLE OPTION FOR INVESTORS
AND CAPITAL FUNDS
17%
Venture Capital exits have
increased by 17% Y-O-Y
INDICATORS
TECH ECOSYSTEM CONTINUES
TO GROW IN THE URBAN CORE
11.5M SF
Occupied by 428 tech firms
in the Chicago CBD
LARGEST AMOUNT OF
TECH OCCUPIED SPACE
4.0M SF
Occupied by tech
in West Loop
GREATEST IMPACT OF TECH ON ANY
SUBMARKET, ALBEIT A SMALL OFFICE INVENTORY
45.2%
Concentration of tech in Fulton
Market/Far West Loop
TECH FOOTPRINT

6. TECH FOOTPRINT
6 // © 2016 CBRE, INC.
BY THE NUMBERS
11.5 MSF
OCCUPIED BY 428 FIRMS
10.6%
OF TOTAL OCCUPIED SPACE
IN CHICAGO CBD
26.8%
CONCENTRATION IN RIVER NORTH SUBMARKET
IMPLICATIONS
Chicago’s tech ecosystem continues to grow as investors
fund acquisitions and IPO’s of the city’s fastest-growing
and most profitable companies. However, as tech tenants
continue to expand within the CBD and beyond, many
worry of the possibility of a looming tech bubble, driven
by over-valuations for start-up firms.
Tech Footprint
02
6 // © 2016 CBRE, INC.

7. TECH FOOTPRINT
TECHBOOK CHICAGO 2016 TECH FOOTPRINT // 7
Chicago’s tech ecosystem continues to flourish, creating
a host of opportunities for landlords and tenants. In total,
more than 140 Chicagoland tech companies received
funding in 2015, collectively raising more than $1.7 billion
in equity and debt financing. Venture capital funding for
digital startups increased 8.9% over 2014 levels and
startup exits, through acquisition or IPO, jumped to a grand
total of $8.2 billion, marking the city’s strongest year for
tech companies. This momentum has contributed to strong
demand for office space, with 1.7 million sq. ft. leased in
2015, representing 23.8% of total leasing activity.
Growing interest from international and local venture
capital firms has sparked demand from tech tenants
seeking space in submarkets all over the Chicago
CBD. Tech tenants currently occupy 11.5 million sq. ft.1
,
representing 10.6% of the total CBD occupied sq. ft.
While tech tenants represent a relatively low percentage
of the overall market, their share has grown at a larger
rate than any other segment in recent years. Since 2011,
tech companies have accounted for an annual average of
15.0% of total leasing activity. From 2013 to 2015, tech
leasing remained in the top three industries, along with
financial and legal services.
While River North remains a top submarket for this
industry – having a 26.8% tech footprint – the largest tech
occupancy can be seen in the newly designated Fulton
Market/Far West Loop Submarket, which grew rapidly as
tech tenants expanded beyond startup offices in adjacent
areas. Tech tenants in this growing submarket currently
make up 45.2% of the local inventory, however, this is partly
due to the fact that Fulton Market has only 2.2 million sq.
ft. of office product, compared to the 11.3 million sq. ft.
and 44.2 million sq. ft. in the River North and West Loop
submarkets, respectively.
In the most popular submarkets of River North and West
Loop, vacancies plummeted and rents soared in response
to growing demand. Rising demand for creative office
space in vintage buildings favored by tech firms has led
to tightened supply in River North, where the vacancy rate
stood at 8.3% overall in Q4 2015 and at 8.0% for the Class
C lofted buildings favored by tech tenants. The area has
also seen rents rise by 5.7% year-over-year. Similarly, West
Loop office properties have seen average asking rents go
from $37.46 per sq. ft. to $39.61 per sq. ft. annually, an
increase of 5.7%. Due to this, tech users have been forced to
look elsewhere for new or expanding space requirements.
As an example, after raising over $650 million in funding,
Avant, an online marketplace for consumer loans, plans
to hire an additional 600 employees over the course of
2016. As a result, it expanded its footprint by 51.6% at
222 N LaSalle St.
As tech tenants demand more space, developers have
responded by constructing new product in growing
submarkets such as Fulton Market, which delivered over
600,000 sq. ft. in 2015 with another estimated 3.0
million either under construction or planned over the next
three years.
FIGURE 1:
TECH FOOTPRINT BY INDUSTRY SUBSECTOR
35%SOFTWARE
18%AGENCY
17%B2B WEB
15%CONSUMER
WEB
15%ECOMMERCE
Sector breakdown of the top 100 companies (by employee)
Source: Built In Chicago, 2015.
The growing space requirements of Chicago’s tech firms
is due in part to their growing workforce. Established
local firms such as Groupon and GoGo, and national
companies like Yelp and Salesforce, have significantly
expanded in the CBD, helping to foster growth in the tech
ecosystem. These companies draw talent from the city’s
world-class universities and well-rounded labor pool. Since
2010, employment in the Chicago tech sector has grown
by 22.6%, while average wages have increased by 5.1%.
As can be seen in Figure 1, the majority of the city’s more
than 3,200 digital firms are concentrated in the software
sector, representing 35% of the top 100 tech companies.
As tech tenants cluster in popular submarkets such as River
North and the West Loop, this concentration of tech talent
has fostered a creative, forward-thinking environment in
which to do business. It should be noted, these benefits
come with associated risks. Although Chicago’s economy
is typically associated with a high degree of business
diversity, submarkets with the highest concentration of tech
tenants may experience volatility in market fundamentals
in the event of a downturn in the tech industry.
1
This does not account for shared workspace offices such as WeWork or Regus,
which host numerous tech tenants on any given week in the CBD – an estimation
ranging from 500,000-700,000 sq. ft. of temporary/shared occupied space.

8. TECH FOOTPRINT
8 // © 2016 CBRE, INC.
Those submarkets with a greater diversity of occupiers,
such as the Central Loop, will be better able to endure the
softening of any one industry.
Chicago’s tech scene is growing and drawing investors that
are injecting larger amounts of capital into local startups
each year. Before 2015, only one company, Mu Sigma,
could be categorized as a unicorn – a company with a
valuation of one billion dollars or more – but as of the
close of 2015, the city has produced three additional firms
that have achieved this status: Uptake, ExteNet Systems
and Avant Credit, valued at $1 billion, $1.4 billion and
$2 billion respectively, according to Built In Chicago.
As investor’s interest in local firms grow, many worry if
the current levels of tech investment are sustainable. As
the Wall Street Journal succinctly puts it in an interview
with an East Coast hedge fund manager, “pricey stock
valuations, record high levels of margin debt and a near
record number of money-losing companies going public
have made some investors nervous that the market has
rallied far beyond what the fundamentals dictate.” While
signs of caution can be found all around, others point out
that although company valuations may be high, there is
evidence that if a crash is on the horizon it may not be
as great in magnitude to what the economy experienced
in 2000. Nationally, funding levels for tech firms have
been rising steadily since 2012, but still only stand at 40%
of their 2000 levels (the height of the dot-com bubble).
Additionally, internet usage has quadrupled and since
2000 and the U.S. economy has finally regained all of the
jobs lost during the Great Recession, indicating a stronger
market for consumer and enterprise related tech services
compared with the tech bubble of the early 2000’s.
Despite these concerns, Chicago’s market fundamentals
remain strong, the pipeline of talent continues to expand
and investors continue to show interest in Chicago firms
– Chicago’s tech scene appears poised for future growth.
0
$5
$10
$15
$20
$25
$30
151413121110090807060504030201009998979695
DEALSINBILLIONS
NUMBEROFDEALS
0
500
1,000
1,500
2,000
2,500
INVESTMENT DEALS NUMBER OF DEALS
FIGURE 2:
HISTORICAL U.S. VENTURE CAPITAL INVESTMENT
Source: PwC/NVCA MoneyTree™ Report, Q4 2015: Thomson Reuters.

9. TECH FOOTPRINT
TECHBOOK CHICAGO 2016 TECH FOOTPRINT // 9
TECH FOOTPRINT
Jackson
Adams
Monroe
Wacker
Ohio
Grand
Ontario
Superior
Huron
Erie
Illinois
Hubbard
Kinzie
Chicago
Pearson
Randolph
Washington
Madison
Wacker
FranklinFranklin
Orleans
Larrabee
Kingsbury
Hudson
Sedgwick
Canal
Clinton
Jefferson
DesPlaines
LaSalle
Financial
Wells
Clark
LaSalle
Dearborn
State
Wabash
Rush
Michigan
Fairbanks
Harrison
Erie
Superior
Chicago
Halsted
Green
Peoria
Sangamon
Morgan
Racine
Aberdeen
LakeShoreDrive
Michigan
Elizabeth
Carpenter
May
Grant Park
Congress
Van Buren
Lake
Milwaukee
45.2%
FULTON MARKET/
FAR WEST LOOP
6.5%
CENTRAL LOOP
8.4%
NORTH
MICHIGAN
26.8%
RIVER NORTH
9.5%
EAST LOOP
9.4%
WEST LOOP
FIGURE 4:
TOTAL TECH OCCUPIED SQ. FT. BY SUBMARKET
Fulton Market/Far West Loop has the highest concentration of tech tenants
at 45.2%. It also has the lowest inventory, which is why it ranks the lowest
by total sq. ft. occupied
0
10
20
30
40
50
FULTON MARKET/
FAR WEST LOOP
NORTH
MICHIGAN AVE.
RIVER NORTHEAST LOOPCENTRAL LOOPWEST LOOP
SQ.FT.(MILLIONS)
NON-TECH SF TECH SF
Source: CBRE Research, Q4 2015.
FIGURE 3:
TECH FOOTPRINT AND CONCENTRATION BY SUBMARKET
10.6%
TECH CONCENTRATION
11,465,830
TOTAL CBDSource: CBRE Research, Q4 2015.

10. TECH FOOTPRINT
10 // © 2016 CBRE, INC.
SPOTLIGHT: GROUPON
Groupon, headquartered at 600 W. Chicago Ave. occupies 375,807 sq. ft.
The global e-commerce leader renewed its lease and expanded its footprint
by 52.9% in July 2015. The non-traditional office building, owned by Equity
Commonwealth, was originally built in 1908 as the Montgomery Ward mail-order
warehouse. Tech firms are drawn to this type of building and 600 West Chicago
has attracted other local companies such as Uptake and Lightbank. Groupon,
which was launched in Chicago eight years ago, currently employs more than
2,100 people at the eight-story building in River North.
SPOTLIGHT: YELP
Yelp opened its first Chicago office at 222 Merchandise Mart Plaza in early
2015, joining a host of other tech tenants and the city’s first and largest tech
incubator, 1871. The online city guide and business review website, currently
takes up 132,044 sq. ft. expanding from its initial lease of 50,000 sq. ft.
Formerly known for its expansive interior design showrooms the Merchandise
Mart has become Chicago’s epicenter for tech innovation and entrepreneurship.
Vornado Realty Trust, the building’s owner, describes the Mart is the nation’s
second-largest office building, falling behind the Pentagon. Yelp plans to hire 300
new employees within the next 18 months.
TECH SUBMARKET SNAPSHOTS
River North
River North has been long favored by tech companies for its amenity-rich
environment, creative building stock and close connectivity to greater Chicago
via public transit. Tech tenants occupy approximately 26.8% of River North office
space. In contrast, tech tenants within the traditional Central Loop office market
occupy only 6.5%. In 2015, the submarket saw significant leasing activity by tech
tenants with 37.9% of all tech deals being done in River North, up from 17.2%
in 2014. Meanwhile, rents have increased every quarter since Q4 2014 and direct
vacancy has hovered below 10%.
Van Buren
Jackson
Adams
Monroe
Randolph
Washington
Madison
Fulton
Carroll
Kinzie
Hubbard
Grand
Halsted
Green
Peoria
Sangamon
Morgan
Racine
Aberdeen
Elizabeth
Carpenter
May
Ada
Ogden
Lake
Eisenhower
10 // © 2016 CBRE, INC.

11. TECH FOOTPRINT
TECHBOOK CHICAGO 2016 TECH FOOTPRINT // 11
Wacker
Franklin
Canal
Clinton
Jefferson
DesPlaines
Kinzie
Illinois
Grand
Ohio
Ontario
Erie
Hubbard
Huron
Superior
Chicago
Pearson
Clark
Dearborn
LaSallee
Wells
Orleans
Larrabee
Hudson
Sedgwick
Kingsbury
Wabash
Wacker
Randolph
Washington
Madison
ChicagoRiver
Monroe
Adams
Jackson
Van Buren
LaSalle
Clark
Michigan
Columbus
LakeShoreDrive
Rush
Michigan
StClair
Fairbanks
McClurg
LakeSh
Chestnut
Delaware
Wells
Lake
Dearborn
State
Wabash
Franklin
State
Kennedy
FEEDER RAMP
ogilvie
station
union
station
RIVER NORTH TECH
FOOTPRINT TAKEAWAYS
• River North supply is very limited, with the direct
vacancy at 8.3% as of Q4 2015, compared to 11.4%
for the CBD. Class A direct vacancy was at 3.7%, and
Class B at 10.1%, compared to 11.1% and 11.8% for
the CBD, respectively.
• Lack of available space coupled with no new
construction has driven up the rents in River North –
average asking rates have increased by
5.7% year-over-year.
• 50% of the tech tenants that reside within River North
are located at 222 Merchandise Mart Plaza.
• 26% of the River North tech tenants call
600 W Chicago home.
TECH COMPANY
CONCENTRATIONS
250,000+ SF
100,000–250,000 SF
50,000–100,000 SF
25,000–50,000 SF
10,000–25,000 SF
10,000 SF

12. TECH FOOTPRINT
12 // © 2016 CBRE, INC.
SPOTLIGHT: GOGO
Nearly two years after announcing one of the largest suburban-to-city relocations
in recent history, GoGo Inc. officially settled into its new headquarters at
111 N. Canal St. in June 2015 – joining a host of other tech tenants such as
StubHub, Fieldglass and Twitter. The company, which offers in-flight wireless services
to airline passengers, was previously based in Itasca, IL a western suburb near
O’Hare Airport. The move is a consolidation of several suburban locations
to 232,000 sq. ft. along the top four floors of the 98-year-old renovated
warehouse managed and developed by Sterling Bay. The move has brought over
500 employees to the Chicago CBD.
TECH SUBMARKET SNAPSHOTS
West Loop
As startups grow out of their spaces in River North, vintage office buildings in
the West Loop have benefited greatly from this movement, providing the same
flexible space advantages as River North, but with larger floor plates essential
for later stage growing tech firms. Tech tenants currently occupy 9.4% of the total
space in the West Loop, totaling nearly 4.0 million sq. ft. Out of the 47 tenants
occupying over 50,000 sq. ft. in the CBD, the West Loop is home to a total of 19
of these large tenants, comprising 60.6% of the tech footprint in the submarket.
This includes large tech firms such as Gogo, LinkedIn and IBM.
12 // © 2016 CBRE, INC.

13. TECH FOOTPRINT
TECHBOOK CHICAGO 2016 TECH FOOTPRINT // 13
Wacker
Franklin
Canal
Clinton
Jefferson
DesPlaines
Halsted
Green
Kinzie
Hubbard
Wacker
Randolph
Washington
Madison
ver
Monroe
Adams
Jackson
Van Buren
LaSalle
Clark
Michigan
Wells
Lake
Dearborn
State
Wabash
Kennedy
ogilvie
station
union
station
WEST LOOP TECH
FOOTPRINT TAKEAWAYS
• The West Loop is the largest submarket, with
44,173,677 sq. ft. of rentable building area, with
another 3.1 million sq. ft. being delivered by 2018.
• Overall average asking rents have increased for the
past 14 consecutive quarters, rising by 14.9% since
Q2 2015.
• 16% of the tech tenants residing in the West Loop
occupy space at 111 N Canal, a Class B building that
is 97% occupied – the majority of which is made up of
tech tenants.
• Tech firms are attracted to 111 N Canal, a concrete loft
style building that offers 58,000-sq. ft. floor plates, an
ideal location with proximity to public transit, and an
array of amenities including a game/conference facility
and roof deck, full service gym, and secure bike room.
TECH COMPANY
CONCENTRATIONS
250,000+ SF
100,000–250,000 SF
50,000–100,000 SF
25,000–50,000 SF
10,000–25,000 SF
10,000 SF

14. TECH FOOTPRINT
14 // © 2016 CBRE, INC.
SPOTLIGHT: AVANT
Located at 222 N. LaSalle, Avant, an online personal lender, raised a total of
$664 million in debt and equity financing in 2015 — the largest funding
ever secured for a Chicago firm. The financial tech company expanded from
its previous 30,000 sq. ft. headquarters at at 640 N. LaSalle in River North to
120,000 sq. ft. in the Central Loop earlier this year. The firm has announced plans
to hire an additional 600 employees by the close of 2016.
TECH SUBMARKET SNAPSHOTS
Central Loop
More known for its traditional office users like law firms and financial companies,
the 1.8 million sq. ft. of space leased by tech users in the Central Loop amounts
to 6.5% of all occupancy in that submarket – making for one of the smallest tech
footprints in the CBD. However, although the share of tech tenants in the Central
Loop is small, the submarket offers users with expanding space requirements
room to grow. While startup companies prefer the smaller lofted floor plates in
River North that offer flexible configurations for collaborative workspaces, Central
Loop buildings offer interior spaces that help more established companies focus
on branding and department segmentation. Typical floor plates in River North
average 17,000 sq. ft., while those in the Central Loop are 10-12% larger,
on average.
14 // © 2016 CBRE, INC.

15. TECH FOOTPRINT
TECHBOOK CHICAGO 2016 TECH FOOTPRINT // 15
Wacker
Franklin
Canal
Clinton
Kinzie
Illinois
Hubbard
Wacker
Randolph
Washington
Madison
ChicagoRiver
Monroe
Adams
Jackson
Van Buren
LaSalle
Clark
Michigan
Columbus
LakeShoreDrive
Wells
Lake
Dearborn
State
Wabash
ogilvie
station
union
station
CENTRAL LOOP TECH
FOOTPRINT TAKEAWAYS
• Central Loop has become a popular submarket for tech
companies as buildings such as 222 N LaSalle St and
203 N LaSalle St have been re-positioned as viable
locations for these types of firms.
• In addition to Avant, tech companies such as kCura,
Digitas, STATS, Sprout Social, and GrubHub call the
Central Loop home.
• The Central Loop has the second largest volume of
tech tenants by square footage, bested only by the
West Loop.
• It is also the second largest submarket by rentable
building area, totaling 35,818,728 sq. ft.
TECH COMPANY
CONCENTRATIONS
250,000+ SF
100,000–250,000 SF
50,000–100,000 SF
25,000–50,000 SF
10,000–25,000 SF
10,000 SF

16. TECH FOOTPRINT
16 // © 2016 CBRE, INC.
DEVELOPMENT PIPELINE
Fulton Market
Due to all the activity and developer interest, Fulton Market/Far West Loop was
officially added as a submarket by CBRE in Q1 2015. What once was an escape
from the high rents in West Loop and River North is now a contender when it
comes to asking rates, with Class A rents going for high $30s gross. Granted,
much of this product still needs to be built, but the bullishness for this submarket
has not diminished. Defined as the area west of I90/94 to Ashland and between
Grand Avenue and Madison Street, it has seen an influx of established tech
tenants as well as start-up companies. Historic industrial properties have been
redeveloped into modern flexible office buildings favored by tech firms. As of Q4
2015, there was 3.1 million sq. ft. of new development either under construction
or in the pipeline. The area’s tech footprint is nearly 500,000 sq. ft. and is home
to tenants such as Threadless, Basecamp and Sandbox.
16 // © 2016 CBRE, INC.

17. TECH FOOTPRINT
TECHBOOK CHICAGO 2016 TECH FOOTPRINT // 17
FULTON MARKET TECH
FOOTPRINT TAKEAWAYS
• Fulton Market has numerous proposed new
development projects, however, existing supply is
limited. This has driven up the rents for the existing
office product, and the average gross rents for a
portion of the submarket are comparable to the Loop.
• 1000 W Fulton Ave, also known as “1K Fulton” was
completed in Q2 2015, adding 535,510 sq. ft. to
the inventory. This building is now 100% occupied.
• 1330 W Fulton, or “Fulton West” is currently
underway and delivering mid-2017, adding
another 290,000 sq. ft. of office space.
Approximately 28% is pre-leased at the new
development.
Van Buren
Jackson
Adams
Monroe
Randolph
Washington
Madison
Fulton
chicagoriver
Carroll
Kinzie
Hubbard
Grand
Wacker
Franklin
Canal
Clinton
Jefferson
DesPlaines
Halsted
Green
Peoria
Sangamon
Morgan
Racine
Aberdeen
Elizabeth
Carpenter
May
Ada
Ogden
Lake
Kennedy
Eisenhower
ogilvie
station
union
station
Whole
Foods
Mariano’s
Target
1K Fulton
535,000 SF
401 N. Morgan
910 W. Van Buren
820 W. Jackson
833 W. Jackson
850 W. Jackson
322 S. Green
300 N. Eliazbeth
954 W. Washington
1033 W. Van Buren
801 W. Adams
310 S. Peoria
940 W. Adams
901 W. Jackson
1021 W. Adams
210 N. Racine
1026 W. Van Buren
370 N. Carpenter 10,300 SF
1330 W. Fulton
266,000 SF
(New Development 4/17)
1056 W. Lake
(New Development)
Harpo
1058 W. Washington
550,000-900,000 SF
(New Development 2017)
1100 W. Grand
100,000 SF
(New Development)
801-811 W. Fulton
70,000 SF
(New Development)
213 N. Peoria
120,000 SF
(New Development)
NEW AREA OF OFFICE GROWTH
TRADITIONAL AREA OF
OFFICE SPACE WEST OF LOOP
RANDOLPH ST RESTAURANT CORRIDOR
GREEKTOWN
Nobu
Hotel
155 rooms
Crown
Plaza
398 Rm.
SoHo
House
35 rooms
Ace
Hotel
150 rooms
Equinox
Hotel
145 rooms
Lake
Green
165 rooms
FULTON MARKET
HIGHLIGHTS
NEW DEVELOPMENTS
EXISTING OFFICE
Photo Credit: Courtesy of Sterling Bay

18. TECH FOOTPRINT
18 // © 2016 CBRE, INC.
DEVELOPMENT PIPELINE
Goose Island
In major cities across the country, developers have taken an interest in the
rehabilitation of centrally located historic communities, creating fresh, appealing
space for today’s young urban demographic known as the “Millennials.” Thanks
to the foresight and innovation of industry-leading developers such as South Street
Capital and R2 Companies, former warehouses and manufacturing plants are
becoming new hubs of office and mixed-use development projects. Goose Island,
located northwest of the CBD, is a prime example of this old-to-new paradigm
and is on its way to becoming one of the most sought-after submarkets in the city.
Additionally, just north of Goose Island in Lincoln Park, C.H. Robinson is planning
a 207,000-square-foot build-to-suit with Sterling Bay at 1511 W Webster. Sterling
Bay has also acquired the razed Finkl Sons steel mill, encompassing 28 acres
of land along the Chicago River and plans to develop more office product. It is
only a matter of time before the development frenzy takes off in this peripheral
area of downtown.
18 // © 2016 CBRE, INC.

19. TECH FOOTPRINT
TECHBOOK CHICAGO 2016 TECH FOOTPRINT // 19
Larrabee
Kingsbury
ChicagoRiver
Haines
Hooker
Hickory
Cherry
NorthBranch
Bliss
Division
Halsted
Evergreen
Eastman
Blackhawk
Cherry
North
Kennedy
934 N. North Branch
909 W. Bliss
700 W. Chicago
DMDII
Wrigley Global
Innovation Center
Mercedes-Benz
enterprise
rent-A-Car
Hertz
rent-A-Car
Kendall College
Chicago Academy for the arts
British School
of Chicago
Toyota
Lexus
Apple store
REI
Crate and Barrel
FedEx
ship center
Whole foods
starbucks starbucks
SoNo East apatments
840 W Blackhawk st
Petsmart
GOOSE ISLAND
HIGHLIGHTS
NEW DEVELOPMENTS
AMENITIES
GOOSE ISLAND TECH
FOOTPRINT TAKEAWAYS
• With high demand for land in Chicago and pressure
from expanding neighborhoods in Lincoln Park,
Clybourn Corridor, River North, River West, Bucktown
and Wicker Park – Goose Island is at the center of
economic development.
• Tech firms, especially start-up companies, are attracted
to Goose Island’s existing red brick facades, large open
floor plates and historic architectural detail.
• One of Goose Island’s last intact sites for
redevelopment is the North Branch River Campus. This
campus is home to 909 W Bliss and 934 N Branch,
totaling 700,000 sq. ft.
• The 909 W Bliss development by R2 Companies offers
a two-building complex with connecting skybridge, with
current redevelopment initiatives including a fitness
center, on-site restaurant and rooftop decks.
• 934 N Branch is the newest addition to the North
Branch River Campus on Goose Island, located right
on the Chicago River. R2 Companies plans to build up
to 364,661 sq. ft. of office space with floor to ceiling
windows and hyper efficient floor plates.
• R2 Companies has also agreed to build a pedestrian
bridge connecting the island to Ogden Avenue, one of
Chicago’s main roadways.

20. TECH FOOTPRINT
20 // © 2016 CBRE, INC.
BY THE NUMBERS
6.5%
RISING AVERAGE ASKING RATE
AT AN ALL-TIME HIGH Y-O-Y
2.1M SF+
OF POSITIVE NET ABSORPTION IN THE PAST
TWO YEARS, DRIVEN BY TECH TENANTS
15.5%
AVERAGE TECH LEASING ACTIVITY OF
THE TOTAL CBD LEASING SINCE 2011
IMPLICATIONS
Despite a modest footprint, tech tenants accounted
for a large percentage of positive leasing activity over
that past 4 years, and tenant requirements have gotten
larger as they expand their footprint
Office Market
03
20 // © 2016 CBRE, INC.

21. OFFICE MARKET
2015 ended on a positive note in the CBD with 792,337
sq. ft. in positive net absorption. These gains caused
the direct vacancy to drop another 60 basis points (bps)
from the previous quarter down to 11.4%. The total net
absorption for the year reached pre-recession levels at
1,336,729 sq. ft., while the direct vacancy declined by 1%
year-over-year. Major market drivers continue to be the
growth of tech, financial services, and shared workplace
companies, as well as suburban relocations to the CBD.
Figure 5 illustrates the positive momentum since 2012.
As a result of a tightening office supply and strong tenant
demand, landlords have been pushing rents in all building
classes. The overall average asking gross rent has risen by
$0.60 per sq. ft. quarter-over-quarter, up to $36.79 gross.
Class A rents rose to $43.04 from $42.56 in the previous
quarter. Rents are at an all-time high in the CBD, rising
6.2% year-over-year.
LEASING ACTIVITY
Tech leasing activity reflects the industry’s growth pattern.
Heightened leasing from tech tenants in 2011 marked the
emergence of this industry as a major factor in the Chicago
economy and office market. Current tech expansion is led
by a new group of start-ups, who have been able to sustain
themselves within the marketplace.
Since 2011, a total of 6.8 million sq. ft. of space was
leased by tech tenants, peaking in 2015 at 23.8%, of the
overall leasing activity in the CBD. In contrast a total of 3.7
million sq. ft. of space was leased over the period leading
up to the Chicago tech boom. The most activity was seen in
River North, which experienced 37.9% of the tech leasing
activity in 2015.
FIGURE 6:
TECH LEASING ACTIVITY 2006-2015
0
5
10
15
20
25
2015201420132012201120102009200820072006
SQ.FT.(MILLIONS)
TOTAL TECH SF
0%
5%
10%
15%
20%
25%
TOTAL TECH PERCENTAGE
-20
-15
-10
-5
0
5
10
15
20
25
30
20152014201320122011201020092008200720062005
SQ.FT.(MILLIONS)
NET ABSORPTION CLASS A CLASS B DIRECT VACANCY
8%
10%
12%
14%
16%
18%
FIGURE 5:
OFFICE MARKET HISTORY: NET ABSORPTION VS. DIRECT VACANCY
Source: CBRE Research, Q4 2015.
Source: CBRE Research, Q4 2015.
TECHBOOK CHICAGO 2016 OFFICE MARKET // 21

22. TECH FOOTPRINT
22 // © 2016 CBRE, INC.
OFFICE MARKET
HISTORICAL DEMAND
The tech landscape has changed significantly since the
beginning of 2011. Even though it always had a presence
in the CBD leasing market, the tech industry was 50-60%
smaller than its current level. As seen in figure 6, from
2006-2010, tech leasing averaged 9% of the total CBD
leasing demand, compared to an average of 16% in the
most recent cycle from 2011-2015. This can be attributed
to a rebounding local economy which helped foster strong
start-up activity, leading to growing space demands in
the CBD.
CURRENT DEMAND
The tech industry currently comprises roughly 10.3%
of the tenants seeking space in the CBD, compared
to 19% from legal tenants and 16.7% from financial
services. The largest tech requirement is as high as
200,000 sq. ft. by a company currently occupying space
in the West Loop. A year-over-year comparison illustrates
that tech requirements have gotten larger, as tenants in
the market for 50,000 – 100,000 sq. ft. now account
for roughly 37%, up from 15% at the end of 2014. This
indicates that tech firms are seeking larger blocks of space
to accommodate growth.
FIGURE 7:
TECH DEMAND BY SPACE REQUIREMENT
Source: CBRE Research, Q4 2015.
SQ.FT.(THOUSAND)
2014 2015
0
200
400
600
800
50,000-100,00020,000-49,99910,000-19,000
RENT GROWTH
While the market as a whole has experienced rent growth
during recent years, submarkets with tech exposure have
seen higher than average rent gains. Since the tech
resurgence began in 2011, Class B and C (often favored
by tech tenants) River North rents have grown 38%, West
Loop 21%, while CBD rents in this segment rose by just
14%. Overall rent growth was also robust, and in all
classes River North saw an increase of 64%, West Loop
13%, and the CBD grew by 14%.
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23. TECH FOOTPRINT
23 // © 2016 CBRE, INC.
OFFICE MARKET
RIVER NORTH
38%
RENT GROWTH
SINCE Q4 2011
WEST LOOP
21%
RENT GROWTH
SINCE Q4 2011
OVERALL CBD
14%
RENT GROWTH
SINCE Q4 2011
FIGURE 8:
ASKING RENT GROWTH BY SUBMARKET
Source: CBRE Research, Q4 2015.
TECHBOOK CHICAGO 2016 OFFICE MARKET // 23

24. TECH FOOTPRINT
24 // © 2016 CBRE, INC.
BY THE NUMBERS
22.6%
GROWTH IN TECH SECTOR
EMPLOYMENT SINCE 2010
34%
OF ADULTS AGE 25+ HAVE A BACHELOR’S
DEGREE OR HIGHER COMPARED WITH US
AVERAGE OF 29%
5.1%
GROWTH OF AVERAGE ANNUAL TECH
EMPLOYEE SALARY SINCE 2010
IMPLICATIONS
Local tech firms are ramping up their hiring efforts and
expanding their space requirements, helping to redefine
Chicago’s economy in the process.
Tech Talent
04
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25. TECH TALENT
Chicago continues to attract talented math, science
and engineering graduates and nurture visionary tech
entrepreneurs. Employment in high tech industries in
Chicago has grown 22.6% since 2010, fueling demand
amongst office users in the tech industry. Today, the metro
area tech labor pool boasts a total of 156,130 employees,
ranking number five amongst US cities with large tech
labor pools of over 50,000 people.
Typically, the greatest cost for occupiers seeking top tech
talent is wages paid to employees. In Chicago, paying for
tech talent comes at a cost that is less than the U.S. average
while providing access to one of the largest labor pools
in the country. 34% of adults over 24 have a bachelor’s
degree or higher compared with the U.S. average of 29%
– making the city a hub for higher education. Additionally,
tech professionals earn 4% less than the average
U.S. wage – a significant cost savings when compared to
cities such as Silicon Valley where tech professionals are
compensated 35% above the U.S. average.
More and more, Chicago graduates are choosing tech-
related career paths and are receiving support from local
universities and city-backed initiatives aimed at developing
successful digital ventures. Between 2012 and 2013,
Chicago-area universities graduated 5,009 students with
tech degrees. Students at top Chicago universities have
launched over 300 VC-backed firms since 2009 and
raised more than $3.7 billion. Public-private partnerships
such as UI Labs – a recently launched research and
commercialization collaborative – are choosing to locate
in close proximity to expanding tech office markets,
amplifying the cluster of innovation and increasing the
value of nearby office properties.
TECH OCCUPATION
EMPLOYMENT
(2014)
EMPLOYMENT GROWTH
(2010-2014)
ANNUAL AVERAGE
WAGE (2014)
WAGE GROWTH
(2010-2014)
SOFTWARE DEVELOPERS/
PROGRAMMERS
55,950 32.6% $81,640 -6.4%
COMPUTER SUPPORT,
DATABASE SYSTEMS
78,450 31.4% $83,109 14.0%
COMPUTER INFORMATION
SYSTEMS MANAGERS
11,830 2.3% $126,390 8.3%
TECHNOLOGY
ENGINEERING-RELATED
9,900 -28.8% $77,497 4.7%
TOTAL TECH OCCUPATION
EMPLOYMENT
156,130 22.6% $92,159 5.1%
FIGURE 9:
TECH EMPLOYMENT BREAKDOWN
Source: U.S. Bureau of Labor Statistics, May 2014.
TECHBOOK CHICAGO 2016 TECH TALENT // 25

26. TECH FOOTPRINT
26 // © 2016 CBRE, INC.
BY THE NUMBERS
$1.7 B
INVESTED IN CHICAGO STARTUPS IN 2015
9%
GROWTH IN VENTURE CAPITAL EXITS Y-O-Y
50%+
OF THE HOTTEST INDUSTRIES FUNDED IN 2015
ARE ENTERPRISE TECHNOLOGY COMPANIES
IMPLICATIONS
Chicago’s tech industry is gaining momentum, attracting
venture capital funding from local and international
investors and giving local companies the capital needed
to grow without leaving the city
Tech Industry Indicators
05
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27. TECH FOOTPRINT
27 // © 2016 CBRE, INC.27 // © 2016 CBRE, INC.
Increasingly, venture capitalists are taking notice of
Chicago tech firms. In 2015, funding for digital companies
increased 9% over the previous year, culminating in the
best year ever for local startups, who collectively raised
nearly 1.7 billion in debt and equity financing. Investors
received massive payouts in 2015 as well, as venture-
backed companies exited via IPO or acquisition for over
$8.2 billion – representing 17% year-over-year growth.
Chicago firms are finding their niche in enterprise-
related technologies, taking advantage of the region’s
diverse economic composition and wealth of corporate
headquarters. In 2015, companies receiving the most
funding included those with a focus on enterprise-related
technologies such as marketing, advertising, enterprise
software and financial technology. In particular, financial
tech companies raised a total of $805 million in venture
capital funding. Over 30% of the companies listed on the
Fortune 500 are located in the Midwest and a total of 34
are headquartered in the Chicago metropolitan region –
providing a wealth of opportunities for tech firms seeking
a market for their software and services.
Economic fundamentals appear strong for the Chicago
tech market. The rapid growth of the past has raised
concerns over growth sustainability and how the local tech
industry will endure business cycle changes.
FIGURE 10:
TECH FUNDING 2011-2015
FUNDING RAISED IN 2015 INCREASED BY 9%
MAKING IT THE BEST YEAR FOR FUNDING EVER!
Source: Built in Chicago, 2015 Chicago startup report.
2011
$1,453M
$391M
$1,055M
$1,585M
$1,721M
2012 2013 2014 2015
+9%
TECH INDUSTRY INDICATORS
TECHBOOK CHICAGO 2016 TECH INDUSTRY INDICATORS // 27

28. TECH FOOTPRINT
28 // © 2016 CBRE, INC.
TECH INDUSTRY INDICATORS
While some worry of a growing tech bubble, others like
J.B. Pritzker, managing partner of Pritzker Group Venture
Capital, the largest technology venture capital investor
in the Midwest and co-founder of Chicago-based tech
incubator 1871, point to the perception of Chicago
startups within the VC community. Recently quoted by tech
news outlet, Built In Chicago, Pritzker noted that enterprise
tech companies in Chicago “tend to have more meat on
them.” He further explained, “ you will tend to see more
revenue and potential for profitability among Chicago
entrepreneurs, than you will among entrepreneurs
anywhere else in the country.”
Not only are Chicago firms viewed as being more pragmatic
and stable than their consumer tech equivalents; Chicago’s
diverse economy helps to dampen the effects of potential
downturns. When compared to cities with a high degree of
employment clustering in the technology industry, Chicago
markets have a true advantage. Although, both Chicago
and Silicon Valley have virtually the same level of tech
employment, only 9.2% of office using jobs in Chicago are
technology based compared to 39.9% in Silicon Valley –
lessening the impact of adverse business cycles.
MARKETING/ADVERTISING
HEALTH TECH
FINANCIAL TECH
CONSUMER WEB
E-COMMERCE
ENTERPRISE SOFTWARE
NUMBER OF COMPANIES FUNDING FOR INDUSTRY
$108M
$176M
$805M
$120M
$50M
$59M
FIGURE 11:
MOST POPULAR INDUSTRIES FUNDED IN 2015
Source: Built in Chicago, 2015 Chicago startup report.
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29. TECH FOOTPRINT
29 // © 2016 CBRE, INC.
TECH FOOTPRINT
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30. TECH FOOTPRINT
30 // © 2016 CBRE, INC.
Industry Outlook
Investors are cautiously optimistic about the Chicago tech market. Indicators for the tech
industry as a whole are flashing warning signs due to the inflated valuations placed on
companies that fail to deliver corresponding earnings. A number of former high profile
unicorns previously valued at $1 billion or more, (Twitter, FitBit, Zynga and Box, just to
name a few) are now trading below their original IPO price – causing investors to re-
evaluate firms with little-to-no profits and questionable value-propositions. Although some
companies are drawing skepticism about their actual market capabilities, most analysts
agree today’s looming tech bubble is nothing like what the industry experienced in the early
2000’s. The key difference being that in today’s market consumer demand for technology
products is more robust and the growing influence of the internet on multiple aspects of
everyday life has led to a practical need for enterprise and consumer-related tech products
and services. This demand has resulted in employment growth which has a ripple effect on
the office market and commercial real estate as a whole.
Indicators for the Chicago tech industry convey a sustainable outlook for continued growth
in consumer and business-related technologies for a diversity of local industries; including
health, e-commerce, finance, human resources, mobile technology and others. Local
support for start-up and early-stage firms, along with investments from venture capital
funds, suggests growth is likely to continue.
Additionally, the success of later-stage firms such as Avant, electing to headquarter in
Chicago, indicates a solid future for growth in the city. Chicago office real estate can expect
strong demand resulting from tech industry growth. Another boost to this industry may be
attributed to locally-based and transplant firms choosing to migrate to Chicago for the
deep and diverse tech talent pools within its unique urban environment. The tech industry’s
influence on the CBD office market will continue to develop as the start-up culture becomes
further entrenched and as existing companies mature and put a sharper focus on their
space needs.
06
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31. TECH FOOTPRINT
31 // © 2016 CBRE, INC. TECHBOOK CHICAGO 2016 INDUSTRY OUTLOOK // 31

32. Disclaimer: Information contained herein, including projections, has been obtained from sources believed to be reliable. While we do not doubt its accuracy,
we have not verified it and make no guarantee, warranty or representation about it. It is your responsibility to confirm independently its accuracy and
completeness. This information is presented exclusively for use by CBRE clients and professionals and all rights to the material are reserved and cannot be
reproduced without prior written permission of CBRE.
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CONTACT:
MATTHEW WALASZEK
Senior Research Analyst
+1 312 297 7686
matthew.walaszek@cbre.com
MEGHAN MCSHAN
Senior Research Analyst
+1 312 935 1400
meghan.mcshan@cbre.com