Trouble ahead: Chicago office market is awash in subleases

Central business district has 4.4M sf of sublease space available, a huge uptick from April

101 North Wacker Drive and Conversant CEO Bryan Kennedy (Google Maps)
101 North Wacker Drive and Conversant CEO Bryan Kennedy (Google Maps)

Digital media company Conversant is looking to sublease its entire Loop headquarters, the latest blow to a Chicago office market that has seen a growing number of firms trying scaling back or exiting their leases.

Conversant wants to sublease its 106,732-square-foot office at LaSalle Investment Management-owned 101 North Wacker Drive, according to Crain’s. Cushman & Wakefield is marketing the space. The listing is for the top four floors of the 24-story building, and represents the second largest sublease in Chicago since the start of the pandemic, according to Crain’s.

Firms across the city have been seeking to downsize and shed expensive office space as employees continue to work remotely because of the pandemic. The move has created a strain on the market.

Chicago’s central business district has more than 4.4 million square feet of sublease space available, up 37 percent since April 1, and 60 percent since the start of the year, according to Crain’s.

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The automotive classified website put a third of its Third Millennium-owned West Loop tower headquarters — about 50,000 square feet — on the market for sublease last month. In May, Groupon sought to sublease 150,000 square feet of office space at its 600 West Chicago Avenue headquarters.

Last month, WeWork abandoned plans to open two locations in Fulton Market. It bought out a pair of leases totaling 110,000 square feet.

And in July, software products firm CCC Information Services said it would scale back the amount of space it will lease at Shapack Partners and Focus’ 750,000-square-foot office building, also in Fulton Market.

Conversant initially opened three floors at 101 North Wacker in 2012. It then leased a fourth floor in 2016. [Crain’s] — Keith Larsen

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