Bike Parts Firm SRAM to Relocate from Chicago’s Fulton Market

SRAM, the bike parts maker whose 2012 headquarters lease helped kick off Fulton Market’s transformation into a tech and office hub, is in talks to leave the neighborhood it helped put on the map.

The company is negotiating a deal to become a tenant and investor in a redevelopment project at 550 West Randolph Street, a vacant 160,000-square-foot loft building just east of Fulton Market, CoStar reported.

Chicago-based R2 Companies is under contract to purchase the building from W.P. Carey for about $14 million. SRAM would anchor the project under a long-term lease and take an ownership stake, sources familiar with the deal told the outlet.

If finalized, the move would mark the end of an era for 1KFulton, the former cold storage facility at 1000 Fulton Market where SRAM occupies more than 70,000 square feet.

That lease predated Google’s splashy entry into the building the following year, which helped solidify Sterling Bay’s vision of Fulton Market as a next-gen corporate neighborhood. The SRAM and Google deals sparked a wave of office development in an area previously dominated by meatpackers and forklifts.

The planned move to Randolph Street, just under a mile east, reflects SRAM’s evolution as well as Fulton Market’s rising costs. The company’s existing space includes R&D areas, traditional offices and a bike track along the perimeter.

R2 has not commented publicly, and the deal could still fall apart amid a soft office market and elevated interest rates. But SRAM’s involvement gives the project early momentum as R2 works to fill remaining space. It would also show some investor confidence in smaller adaptive reuse plays even amid sluggish broader office demand.

For Office Properties Income Trust, which owns 1KFulton, the departure would be a blow.

The REIT paid nearly $355 million ($668 per square foot) for the building in 2021 and may soon face the prospect of having to backfill the bulk of the building when Google moves to the Thompson Center.

— Judah Duke