The suburban office market is making a comeback

Turnkey space in greater Chicago area is attracting tenants

Chicago /
Jul.July 06, 2020 12:20 PM
Somerset Development President Ralph Zucker and renderings of Bell Works Chicagoland

Somerset Development President Ralph Zucker and renderings of Bell Works Chicagoland

The great worker exodus of 2020 is providing hope to owners of office space in the Chicago suburbs.

“Suburbia is getting a fresh look,” Somerset Development’s Ralph Zucker told Crain’s. His company is repositioning the vacant former AT&T campus in Hoffman Estates into a $200 million mixed-use project with 1.2 million square feet of office space.

Though real estate brokers say it’s too soon to know whether the suburban office parks of yesteryear are truly back, inquiries are on the rise.

And the kind of space that’s most in demand is pre-built and positioned to attract companies needing satellite space outside of downtown Chicago.

“Those employees are getting tired of working from home, but on the other hand the idea of hopping on the train and coming downtown may be something they don’t want to do right away,” said Michael Klein, managing principal of Chicago-based developer GlenStar, which has invested in large suburban office properties over the last few years.

The revival in suburban office spaces also comes down to a simple value proposition: talent recruitment led to a 75 percent premium on downtown space, but those numbers no longer add up, tenant rep Don Wenig told Crain’s. “I think business owners are going to be hard-pressed to justify paying for that real estate when they have geographic flexibility,” he said. [Crain’s] — James Kleimann


Related Articles

arrow_forward_ios
TTX Company CEO Thomas Wells and 101 North Wacker Drive (Google Maps)

Off the rails: Freight train provider lists West Loop HQ for sublease

Off the rails: Freight train provider lists West Loop HQ for sublease
HNA Group Founder Chen Feng and 181 West Madison Street (Getty, Google Maps)

Here’s what tenants pay at HNA’s 1M sf Loop office tower

Here’s what tenants pay at HNA’s 1M sf Loop office tower
Aon Center (Google Maps)

Here’s what tenants pay at 601W Cos.’ Aon Center

Here’s what tenants pay at 601W Cos.’ Aon Center
The Old Post Office (Google Maps)

Here’s what tenants pay at 601W Cos.’ Old Post Office

Here’s what tenants pay at 601W Cos.’ Old Post Office
Deutsche Finance America managing partner Jason Lucas and Michael Shvo, with 333 South Wabash

What tenants are paying at Shvo and Deutsche Finance’s “Big Red” building

What tenants are paying at Shvo and Deutsche Finance’s “Big Red” building
The suburban office market saw a slight rise in second quarter vacancy rate

Suburban office market vacancy rate nudges up

Suburban office market vacancy rate nudges up
353 N. Clark with Chester Kamin of Jenner & Block (Google Maps)

Actually, you owe us money: Chicago law firm fires back at landlord

Actually, you owe us money: Chicago law firm fires back at landlord
If there’s a 20% drop in users of the downtown office market, Chicago’s character could massively decline (iStock)

The double whammy hitting Chicago’s downtown

The double whammy hitting Chicago’s downtown
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...