Bell Works Chicagoland Begins Office Expansion

Ralph Zucker has launched the next phase of construction at Bell Works Chicagoland, his development firm’s “metroburb” remake of the former AT&T headquarters in Hoffman Estates.

The New Jersey-based firm, Inspired by Somerset Development, began work Monday on a major renovation of the west side of the 1.2 million-square-foot property at 2000 Center Drive, the Chicago Tribune reported, with plans to deliver 430,000 square feet of traditional office and 70,000 square feet of retail. The new wing will feature a walkable “Main Street” layout with storefronts, restaurants and gathering spaces.

Wight & Co. is the architect on the expansion and npz studio+ is leading interior design. The redevelopment aims to ride the success of Bell Works’ east side, which went through $200 million in renovations and is now more than 90 percent leased and includes offices, cafés, coworking areas and pedestrian zones.

Zucker’s turnaround of the former AT&T campus — which plans additions of multifamily buildings — may serve as a blueprint for buyers of other deeply discounted suburban Chicago buildings that have already traded hands at big losses for sellers or are getting ready to as the vacancy-riddled market resets. Some developers have also pondered whether to alter suburban office campuses to include housing or to convert them altogether into industrial or data center assets, while buyers of distressed properties near O’Hare International Airport have started comebacks as traditional offices.

Somerset bought the Bell Works campus for $21 million in 2019, a stark discount from its $338 million sale as part of a two-property portfolio back in 2005. It gained its first new tenant in 2020. The development firm has since aimed to build out a full mixed-use community on the site.

The east side’s low vacancy puts the property in rare company within Chicago’s northwest suburbs, where the office vacancy rate topped 32 percent in the first quarter, the highest among the region’s submarkets, according to Colliers. That context, Somerset CEO Ralph Zucker said, is what makes Bell Works’ leasing progress significant.

Its tenant roster so far includes medical device provider Arjo, which is relocating its U.S. headquarters to the property next year, and Swing Loose, an indoor golf simulator venue. Wireless networking company Cambium Networks signed a long-term lease in 2023.

“There is a return to office, but it has to be the right kind of office,” Zucker told the newspaper, citing tenant preference for “inspired spaces.”

The west side buildout is expected to take 12 to 18 months. Somerset also began construction earlier this year on a 164-townhome development on the 20-acre residential portion of the campus and is planning an additional 300-unit multifamily building.

— Judah Duke