One of the biggest tenants in Chicago’s Willis Tower, law firm ArentFox Schiff, is close to signing a lease renewal that will trim its office footprint by more than 50 percent.
The law firm’s cutback adds pressure to Willis Tower’s owner, Blackstone Group, which has worked to preserve the value of the property amid reduced demand, rising interest rates and a massive loan maturity.
The law firm is expected to lease just over 75,000 square feet across three floors, down from the more than 168,000 square feet it currently occupies, Crain’s reported. The new lease would extend well beyond the current deal’s expiration in July 2028, marking a significant recommitment to the city’s tallest skyscraper despite ongoing challenges in the downtown office market.
This downsizing reflects the broader trend of reduction driven by post-COVID shifts in workplace strategy. Remote and hybrid work have prompted companies to reassess their real estate needs, contributing to more than 2.3 million square feet of negative absorption in Chicago’s central business district office market over the past two years.
The downtown office vacancy rate has hit record highs every quarter for the past three years, according to brokerage CBRE.
While some professional service firms such as Bain and Sargent & Lundy have expanded their downtown workspace, ArentFox Schiff’s move highlights a continued struggle for landlords as long-term leases signed before the pandemic come up for renewal.
The law firm’s downsize comes as separate appraisers take different approaches to how the Willis Tower’s 103rd-floor tourist attraction known as the Skydeck should count toward the value of the building, as estimates produced by both the public and private sectors in recent months have ranged from $999 million to $1.4 billion.
Either way, the building is either well below the value of its $1.3 billion mortgage debt or just barely treading water, depending on how the Skydeck’s value is incorporated.
Blackstone acquired the property in 2015 for $1.3 billion and invested an additional $500 million in renovations and retail enhancements. The building was appraised at $1.8 billion during a 2018 refinancing. After securing a loan maturity extension earlier this year, Blackstone now has until March 2030 to restore the tower’s value and recoup its investment.
The 110-story skyscraper’s office space was 87 percent leased as of January 2025, with United Airlines as the largest tenant, occupying nearly 666,000 square feet through 2033. Other major tenants include Morgan Stanley and law firm Seyfarth Shaw, both of which have options to reduce their presence in coming years.
ArentFox Schiff was formed in a 2022 merger between Arent Fox and Schiff Hardin and orchestrated by chairman Anthony Lupo. The combined firm reported more than $629 million in revenue last year.
CBRE’s Mark Cassata, Kyle Kamin and Dan Persa are negotiating the lease on behalf of the law firm, while Telos Group’s Nikki Kern, Jamey Dix and JD Parcheta represent Blackstone at Willis Tower.
— Joel Russell
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