The owner of Bell Works Chicagoland has taken another step toward revitalizing AT&T’s massive former campus in Hoffman Estates.
Inspired by Somerset Development, the New Jersey developer who bought the vacant complex in 2019, signed leases with a new group of tenants, nearly filling a suite of offices designed for small businesses and startups. Offering leases as short as four pages, fully-built spaces and amenities, company officials said the 23,618-square-foot suite, called Ready-to-Wear, meets the needs of small businesses trying to navigate a market of offices unstable due to the pandemic. .
“You don’t need to bring a lawyer, a contractor or a decorator,” said Ralph Zucker, president of Somerset. “We do it all for you.”
“Every other place I went to said it would take three to four months to build the space,” said Chadd Folkes, president of risksmith Insurance Services, a 4-year firm that took about 2,900 square feet at Bell Works last year. . and just expanded to 5,000 square feet. “Here, it was already finished. It’s almost like having a WeWork, but with a long-term lease. It was literally plug and play.”
The pandemic temporarily put new leases on hold, but Somerset has renovated the approximately 400,000-square-foot east portion of the complex, along with its central atrium, and has so far leased about 150,000 square feet, including a deal with clothing company Club Colors, which established its national headquarters at Bell Works Chicagoland at the beginning of this year.
Filling the rest could be a challenge. Before the pandemic, Somerset renovated the former 2 million-square-foot Bell Labs campus in Holmdel, New Jersey, turning it into a fully leased mixed-use complex, but now companies are reducing their footprints as employees continue to work. from home, sending vacancy rates to record highs and making it difficult for many landlords to sign on new tenants.
But Bell Works Chicagoland can buck that trend, Zucker said. The key will be transforming what had been a barren 1980s-style complex just north of I-90 into a “metroburb,” an amenity-rich community hub for Bell Works tenants and Hoffman Estates residents. , a true hub for the Northwest suburb. Meanwhile, outdated properties with few amenities will bleed tenants dry as businesses look for spaces that offer employees a better-than-home environment, he added.
“The (space) has to be amazing and give people a reason to come in,” Zucker said. “You’re going to see a lot of office buildings, especially in the suburbs, fall to the wayside. We’re seeing that in New Jersey, and we’re seeing it in Chicago as well.”
The Northwest suburban office market was already suffering when COVID-19 hit, with vacancy rising to nearly 30% in part as major employers like Motorola Solutions moved into downtown Chicago, according to the commercial real estate firm Colliers International. Vacancy rose to a record 34.9% earlier this year, but in the second quarter the area finally saw little change. Vacancy fell to 31.8%, driven mainly by companies that lease prime space.
“High-quality, best-in-class assets continue to see the most activity in the Northwest market,” Colliers found. “Class B properties in the Northwest market will continue to suffer until Class A assets are absorbed.”
Somerset added new offices, public spaces, pedestrian walkways, cafes like Fairgrounds Craft Coffee and Tea, a state-of-the-art fitness center and coLab, a 15,000-square-foot coworking area, to the vast interior space of Bell Works Chicagoland, where it also hosts public events like galas fundraiser and an Oktoberfest. It’s also putting the finishing touches on a second set of Ready-to-Wear offices, and Zucker said he expects other firms to fully occupy that space in the coming months.
Other new Ready-to-Wear tenants include Stoltmann Law Offices, Victor Construction Co., LinkSpace, a furniture dealer, and Berkshire Hathaway Starck Real Estate, a family-owned brokerage firm.
Folkes said he was not impressed when he first walked into the Bell Works. It was still a raw space back then, with the spartan vibe common among suburban offices in the 1970s and 1980s. But besides being able to bring your dogs to work Every day, community events, new boardwalks, outdoor walking trails, and coffee shops have made a difference.
“It’s not like the 1970s anymore,” he said. “It’s fresh, clean and has energy. You are starting to see the vision.”