Huron Consulting Shrinks Chicago Headquarters Lease

Huron Consulting Group is staying put in Chicago’s West Loop, although with a lot less space than the company is used to.

The Chicago-based firm signed a long-term lease extension at 550 West Van Buren Street, trimming its office suite to about 83,000 square feet from roughly 134,000, according to sources familiar with the deal. The move locks in Huron’s headquarters through 2037 while formalizing a pandemic-era downsizing that had lingered for years.

The shift highlights the current trend downtown landlords are experiencing: Even as leasing activity steadies, large tenants continue to give back space. Crain’s first reported the deal, citing a company spokesperson who said the new lease “aligns with our current and ongoing space needs.”

Huron has occupied the 17-story, 334,609-square-foot building for more than two decades and still has its name emblazoned outside. But like many office users, it never fully refilled its pre-pandemic office space needs. The latest lease essentially rightsizes to match hybrid work patterns that have outlasted return-to-office expectations, according to the outlet.

That dynamic continues to weigh on Chicago’s central business district. Office tenants have shed nearly 3 million square feet over the past three years. That’s about 2.5 times the contraction seen during the Great Recession, according to the publication. Vacancy remains at record highs even as deal volume picks up, with average downtown occupancy hovering at about 72 percent as of March, according to CBRE.

The landlord for the building, Vancouver-based Onni Group, bought the property for $78 million in 2019, when it was about 91 percent leased. With Huron’s reduction, occupancy has dropped to roughly 62 percent, according to CoStar data.

Current vacancies haven’t stopped Onni from doubling down on downtown Chicago. The firm recently paid $125 million for the 1.1 million-square-foot, 50-story office tower at 161 North Clark Street, and has touted a turnaround at the 31-story Illinois Bell building at 225 West Randolph Street following a major repositioning.

— Eric Weilbacher