The urbanization of suburban office buildings

  • The employees of the Zurich Towers in Schaumburg are move into their new North America headquarters this year. Suburban building owners realize they can compete with the new and/or repurposed buildings in Chicago's hot Fulton Market, West Loop and River North markets.

      The employees of the Zurich Towers in Schaumburg are move into their new North America headquarters this year. Suburban building owners realize they can compete with the new and/or repurposed buildings in Chicago's hot Fulton Market, West Loop and River North markets. Mark Welsh | Staff Photographer

  • Aimee Val

    Aimee Val

  • The market is demanding the modern office complex provide a hospitality feeling for employees and visitors.

    The market is demanding the modern office complex provide a hospitality feeling for employees and visitors.

  • The market is demanding the modern office complex provide a hospitality feeling for employees and visitors.

    The market is demanding the modern office complex provide a hospitality feeling for employees and visitors.

 
Updated 9/21/2016 3:45 PM

Sophisticated suburban building owners have grown tired of the ongoing storyline that millennials (and the businesses that seek hire them) loathe the suburbs. As a result, certain ownership groups are taking command of their buildings -- and future occupancy opportunities -- and moving past the shortcomings of 1980s- and 1990s-developed suburban office properties.

At issue then for a significant segment of the suburban inventory is that it was designed and developed before much of the millennial generation entered the workforce (or, in some cases, was born). As a result, the buildings are not equipped to appeal to millennial (and older) lifestyle patterns.

                                                                                                                                                                                                                       
 

Increasingly, building owners across the suburban marketplace are addressing this fact and realizing that they can compete -- and with great success -- with the new and/or repurposed buildings in Chicago's hot Fulton Market, West Loop and River North markets.

"Large-scale corporate relocations to the CBD like McDonald's are headline grabbers, for sure," said Steve Kling, principal and co-head of Colliers International's suburban Chicago office leasing team. "The lesser-known story is how suburban office landlords are stepping up in a big way to offer amenity packages that rival those at the most sought-after CBD properties," he added.

Kling called out Zurich Towers -- the 882,000-square-foot, two-story complex in Schaumburg that his firm leases -- as a shining example of the suburban renaissance. When Zurich opted to build a gigantic new facility down the road from its namesake property, owner RPAI knew a big change would be needed to fill the towers once again. Paylocity recently committed to a 309,000-square-foot lease there, and RPAI is betting that other tenants will follow to take advantage of the renovation being led by architect Wright Heerema.

"Paylocity was attracted to the plans for a full renovation of the outdoor plaza, fitness center, cafeteria, and conference center, and the addition of a game room," Kling said. "Other important features will include electric car charging stations, main reception which replaces the former security providing a welcoming feel. The market is demanding the modern office complex provide a hospitality feeling for employees and visitors. Therefore, the common areas will look and feel more like a luxury hotel rather than the previous office buildings," he added.

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Some of the other Colliers-represented buildings and complexes at the forefront of urbanizing their amenity offerings include the Parkway North complex in Deerfield, Kemper Lakes in Long Grove, Tallgrass Corporate Center in Bolingbrook, 750 Commons in Aurora, Tri-State International in Lincolnshire, 1000 Milwaukee in Glenview, and MetroWest in Naperville.

Clearly, the blueprint for attracting and retaining millennials is still being defined and refined. However, the most popular and necessary amenities that are being added, expanded, or redesigned in suburban buildings include:

• Food -- The boundaries between work and healthy lifestyle choices have blurred more and more, creating opportunities for building owners that can cater to these choices. The menu of food options has gone through an ongoing evolution as well. Gone are the days of the limited offering delis or food service purveyors. Instead, especially in larger building or multi-building complexes, there are either multiple restaurant offerings or larger food service providers carrying a varied menu.

• Fitness -- Many suburban office buildings have offered small workout rooms with only a handful of machines. There is a new expectation among tenants that includes more expansive offerings of equipment, workout spaces, private training, group exercise, and fully stocked locker room facilities.

                                                                                                                                                                                                                       
 

• Collison spaces -- Whether planned or the result of a spontaneous encounter, people like to come together to collaborate and brainstorm in settings that simply may not be offered in a traditional tenant office environment. Instead, they look to areas throughout the building, whether that is a coffee area, a breakout room or a more complete conference room where they can congregate.

• Outdoor spaces -- Even in Chicago, where the weather can be so unpredictable and outdoor seasons are at a premium, people like their outdoor spaces and the ability to clear their minds from the stresses and pressures of the work day. The most appealing outdoor spaces may include a walking/biking path or exercise trail, with access to a locker room facility to freshen up after taking advantage of this natural amenity.

• Technology centers and Wi-Fi lounges -- We live in a world where being connected is important, and the different options for doing so are plentiful. Technology centers and Wi-Fi lounges are increasingly important, providing a different setting to get work done or to take a social media break and come back recharged.

Certainly these urban-style amenities aren't logical or financially feasible for all buildings.

"It is our experience that the building profile that works best for the addition of these types of amenities is one that is approximately 500,000 square feet and larger" Kling said.

Gone are the days of an office location that is just minutes from the home of members of the C-suites. Rather, it often is about the available amenities and the benefits they provide to employees and companies.

In today's uber-competitive office leasing marketplace, the building's amenity package is often the deciding factor. Those buildings that are offering modern, urban-style amenities are leasing space and maintaining higher occupancies than those that don't. While it is a matter of cost, many tenants are willing to pay some type of premium for the amenities that will help them attract and retain employees.

• Aimee Val is vice president of marketing and communications at Colliers International.

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