As Companies Decamp for the City, Suburban Office Parks Struggle

Mirroring a nationwide trend, office parks in suburban Chicago are emptying out as companies increasingly favor urban locations. As a result, developers and local officials are having to think creatively about possibilities for office park reuse.

2 minute read

August 13, 2012, 10:00 AM PDT

By Jonathan Nettler @nettsj


When Motorola Mobility announced recently that it would be trading in its home in Libertyville for prime space in Chicago's Merchandise Mart, it joined BP Amoco, United Airlines, and Sara Lee in helping to reverse the corporate exodus from Chicago, and cities across America, that marked the rise of the suburbs in the decades following World War II.

For reporter David Roeder, Motorola's move is, "another example of how the isolated, splendidly landscaped
corporate base in the suburbs has fallen out of favor." With office space in the suburbs facing a "hard sell" since the start of the financial crisis, "these compounds by and large must look to the private market for a new reason to exist."

"Daniel Miranda, president of HSA Commercial Real
Estate, said possibilities include turning some campuses into retail
centers, perhaps outlet malls, or converting them for medical or
educational uses. Some suburbs, Miranda said, may wish to convert the
campuses into a carefully planned 'mini-town.'"

"Many analysts have said a desire to recruit
younger, tech-savvy workers drives the job shift to downtown," notes Roeder. "Tony
Smaniotto, senior managing director at Studley Inc., said cost control
is another factor."

Some analysts however, like Art Burrows, senior vice president at NAI Hiffman, are skeptical of how long this trend will continue. He believes, "the suburbs will
come back when there's a clear price advantage and housing improves."

 

Wednesday, August 8, 2012 in Chicago Sun-Times

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