Financial services firm Mesirow will stay in Chicago for the long haul after undergoing a sizable haircut to its headquarters space.
The company signed a 10-year lease extension for its offices at 353 North Clark Street in River North, committing to the location until 2036, Crain’s reported. However, the company is adapting to the remote work trend by reducing its office footprint by one-third, from 165,000 square feet to approximately 110,000. The cut aligns with the decreases being made by many other commercial real estate tenants.
The 47-story tower, co-developed by Mesirow in 2009, will also undergo changes as part of a realignment strategy.
Despite the downsize, the lease extension marks a win for the city and the 1.2-million-square-foot building’s landlord Heitman amid an exodus of company headquarters and a record-high office vacancy rate of nearly 25 percent, driven in large part by the pandemic and remote work.
Heitman’s 353 North Clark has experienced a series of cutbacks, including Mesirow’s recent downsize and a prior reduction by law firm Jenner & Block. Despite these changes, the building remains 89 percent leased, outperforming the average downtown office building occupancy of 76 percent. Heitman bought the property for $715 million in 2014.
The lease extension is part of a trend in which companies affirm the need for workspace but in smaller quantities. Mesirow, despite a growing local headcount, is restructuring its lease size and acknowledging the shift towards virtual meetings and reduced office usage.
Natalie Brown, Mesirow’s CEO, said the company’s focus is on right-sizing its space and plans to update existing offices to enhance the employee experience. The firm will retain a presence in the tower, with employees required to be in the office on specific weekdays.
Cushman & Wakefield’s Ari Klein and Scott Shelbourne negotiated the lease extension on behalf of Mesirow, with Mike Kazmierczak and Seth Tuscher of CBRE overseeing leasing at the Clark Street building.
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