Post-Pandemic Suburban Chicago Office Space In Demand

After decades of downtown Chicago office space experiencing high demand, it seems as though the tide is turning. And the suburbs have Covid to thank…along with higher rents, taxes, and operating costs.

Pre-Pandemic Class-A office space in downtown Chicago’s premier areas saw record rental rates of $90-$100 per square foot when taxes and operating costs were included. Meanwhile premium space in bustling suburbs such as Naperville top out at approximately $40.00 per square foot.

Prior to Covid, popular Chicago suburbs such as Evanston saw an increased demand. According to Bisnow, that demand only grew when millennials sought out suburban homes to whether out the pandemic. With more square footage for less money, purchasing homes in suburbs made financial sense. In fact, “National polls show 37% of all homes last year were purchased by millennials between the ages of 20 and 35, she said, and 54% of those homes were situated in a suburb. In the Chicago area, Evanston saw the most new millennial residents in 2021, followed by Naperville and DuPage County,” states Bisnow.

Now, as companies return to the office, employees are questioning their long commute as they consider all the new amenities their suburban lifestyle provides.

The question posed at March 30’s “Bisnow’s Chicago Future of the Suburbs” event was whether a stressful commute and higher downtown rental rates would be enough to maintain the demand for suburban office space.

The answer comes with caveat…yes, if suburban office buildings and parks can offer the same amenities millennials have grown to expect in downtown HQ’s. Focus should be on health and wellness centers, tech-enabled spaces, creative studios, flexible working spaces, cafes, and more.

Additionally companies may seek a “hub and spoke” model taking less square footage at multiple locations, both city and suburban. For example, “Allstate, which sold its suburban headquarters in Northbrook in November 2021 and purchased a 10-story building at 29 North Wacker Drive in Chicago’s Loop early this year. Even so, Allstate plans to continue leasing suburban office space in what the company said was an effort to give employees more choice in where they work,” continues Bisnow. Therefore, there may be a reduction in space utilized at each location to accommodate the multiple location model.

O’Donnell Commercial has ideal suburban office space for companies looking for a large suburban headquarter or satellite location. Poplar Creek Office & Medical Plaza offers companies up to 110,000 square feet with amenities like an on-site car wash, fitness center, shared lunchroom, and heated car parking. For more information, call 630.444.0444.