Each week, The Elevator Speech summarizes news related to some of the key industry trends, buildings, deals and dealmakers that shaped headlines. Below are articles that caught our attention the week of October 28.
It’s Officially “A Go”
Gogo Inc., an in-flight wireless provider, has confirmed that its Itasca headquarters will be relocated to the West Loop. Gogo plans to bring more than 460 jobs to its new office, a 232,000 square foot space at 111 N. Canal St., with plans to add more than 50 jobs within the next two years. According to a press release from Gogo and Mayor Rahm Emanuel’s office, Gogo’s move is one of the largest suburbs-to-city relocations in years.
Priciest Places to Work
Colin Dyer, president and CEO of Jones Lang LaSalle, published a blog post this week on the top 12 “priciest places to work” in the world. Only two US cities make the list – Menlo Park in Silicon Valley, which made fifth place and Fifth Avenue in midtown Manhattan, which came in at seventh. Dyer listed six traits that these 12 cities have in common:
- Located in premier districts of global commerce and financial centers
- Well-connected internationally
- Home to high-value talent and high-net-worth tenants
- House a large numbers of global corporate headquarters
- In supply-constrained areas, giving them an aura of exclusivity
- Close to clients, travel, transportation and cultural and retail amenities.
Keeping an Eye on the Law
According to a survey of 286 US firms by New York-based real estate brokerage Cushman & Wakefield Inc., law firms average an alarming 823 square feet per lawyer, a rate which is two to three times the ratio of other professional services industries. Law firms are increasingly aware of their real estate expenses – the second-highest fixed expense after salaries. During a time when the law firm industry is experiencing heavy job cuts and unpredictability, large and opulent spaces for lawyers are seemingly becoming a trend of the past.
As a result, firms are paying closer attention to scaling down their spaces. Obtaining flexibility in office leases is also becoming an important negotiation component.
A 20-year lease signed by McDermott Will & Emery LLC for the River Point office tower is an example of this growing trend. This lease is said to include many options of adding or subtracting space as needed. DLA Piper, a law firm that is negotiating a 16-year agreement at River Point, is requesting similar provisions.
Associated Bank recently consolidated five offices into a unified headquarters on the top floors of 525 W. Monroe. Offices at 190 N. LaSalle St., the Prudential Plaza, suburban Deerfield and two spaces in the Aon Center have moved into the 35,000-square-foot space on the 24th and 25th floors of the 904,000-square-foot West Loop tower. Breck Hanson, the bank’s EVP and head of commercial real estate, believes that this move has not only boosted the bank’s Chicago reputation, but has also provided employees with a more central and convenient location in terms of travel.
Chicago-Based Real Estate Firm Focuses Abroad
The international branch of Capri Capital Partners LLC announced a strategic alliance with an India-based real estate finance firm, Money Matters Financial Services Ltd., which has been renamed Capri Global Capital Ltd.
Quintin E. Primo III, chairman and CEO of Capri Capital, will assist in developing a strategy to explore investment opportunities in Indian, African and the Middle East commercial and residential real estate markets. Capri Capital currently manages $3.6 billion in assets.
Primo, who believes the Chicago market is becoming oversaturated, plans to “capture an opportunity very quickly” through his international agenda.
What CRE or Chicago news headlines from the past week captured your interest? Leave us a comment and let us know.