Early last summer, there was a glimmer of hope that rising demand for homes outside of Chicago would lead to a stronger suburban office market, with companies opening satellite spaces to accommodate the influx of workers.
The opposite happened. As the remote-world locked in, office vacancies rose and millions of square feet hit the sublease market.
Now, hoping for a comeback, two office complexes are hitting the market — one in Downers Grove and the other in Oak Brook, according to Crain’s. Cushman & Wakefield has both assignments.
Stanton Road Capital listed its 190,000-square-foot Woodland Corporate Tower at 1333 Butterfield Road in Downers Grove. The firm paid $12 million for the complex four years ago, and embarked on an extensive renovation that boosted occupancy to 96 percent from 55 percent, the report noted. The six-story property’s largest tenant is Faucet maker Elkay Manufacturing, with 82,000 square feet.
In Oak Brook, Clear Height Properties and Buligo Capital Partners want to sell 814 Commerce, a 173,000-square-foot property. The duo is seeking $12, after having paid $8.4 million for the complex a year and a half ago; they also poured more than $1 million into renovations. Last year, the owners signed the American Board of Radiology to a long-term lease for 71,000 square feet, but the company put up the office for sublease in November. The complex will be just over half leased by mid-summer, according to Crain’s.
Suburban office market struggles mirror those in Chicago, where first quarter vacancy hit 16.1 percent. This week, two office buildings on North LaSalle Street hit the market, one eyeing $200 million. The other is asking $20 million, about 38 percent below what the owner paid for it in 2016.
[Crain’s] — Alexi Friedman