Sep 14, 2017, 12:33 PM
The right workplace is out there. We’ll help you find what you’re looking for.
Author's note: Already know what you're looking for? Ready to get started? Contact our Chicago Tech Practice Group to find your space.
With affordable rents and a highly educated, in-demand workforce, Chicago has emerged as a central hub in the massive expansion of a maturing tech industry.
Growth is exciting, yet filled with unknowns and a lot of risks. As a maturing tech company, you need to create an occupancy strategy, select the right location for expansion, manage costs and attract talent.
Our high-growth guide, On the Rise, is a real estate roadmap designed to help tech companies in Chicago do all that and then some. Download now or scroll for a preview of what’s inside.
Your key business questions answered:
Do you need assigned workstations or full mobility? Activity-based or open plan? That all depends—on your headcount, culture, workstyle, budget and growth plans. But you have options!
Note: Cost per year is at $30 s.f. gross for 25 employees. (Does not include tenant concessions.)
Fully unassigned workstations and support space.
- Space per person: 50-100 s.f.
- Office space: 2,500 s.f.
- Cost per year: $75,000
❯❯❯ This is the most typical space for tech companies. ❮❮❮
Mix of unassigned and assigned workstations and support space.
- Space per person: 100-150 s.f.
- Office space: 3,750 s.f.
- Cost per year: $113,000
Activity-based open plan
Fully assigned open plan workstations and support space.
- Space per person: 150-200 s.f.
- Office space: 5,000 s.f.
- Cost per year: $150,000
Four Chicago neighborhoods are great fits for tech companies, but each has its own distinct feel. Selecting the right area can have a big impact on your brand and ability to attract and retain talent.
Compare amenities, transit and rents with these neighborhood snapshots.
Just north of the Loop and adjacent to the Chicago River, River North has come to life with a vibrant art scene and diverse cuisine. A number of tech tenants, both big and small, reside in a single iconic building: Merchandise Mart. Bus stops abound and every 'L' train line is within a five-minute walk. Commuter trains are a short walk or shorter cab ride across the river.
Due west of the Kennedy Expressway between Hubbard and Madison, this former meatpacking district has become a melting pot of culture and innovation, spearheaded by Google’s HQ relocation. A submarket of West Loop, Fulton Market is beloved for industrial space that’s repurposed and reborn. Growth in retail, restaurants and the tech ecosystem is abundant, and three 'L' lines have stops close by.
Encompassing three different submarkets (River West, Fulton Market and the Far West Loop), Kennedy West—aka the Near West Side—was born of spillover from the rapid expansion of West Loop. Just west of the Kennedy Expressway, it’s a crossroads of creation and convention that benefits from proximity to West Loop’s tech epicenter. This area is accessible via three 'L' lines and has a greater cultural mix than the others with restaurants, parks, green space and Greektown and Little Italy nearby.
Adjacent to the heart of the downtown CBD, West Loop's been transformed by recent renovations with the old warehouses providing unique homes for fashionable boutiques, restaurants, arts—not to mention a landslide of corporate relocations. Presenting competitive pricing compared to the desirable River North, West Loop is capturing major tech attention.
Do you intend to renovate your new space or rent a plug-and-play office that’s ready to go? When does your current lease end? The more time you have to make and finalize a deal, the stronger your negotiating position, so allow as much lead time as you can.
Market supply and demand will dictate some of your pricing and negotiating leverage. Compare the average asking price for different buildings, but remember there are several factors besides rent to consider.
Least types you're likely to see
Full service gross (FSG): An all-inclusive rental rate that includes operating expenses and real estate taxes for the first year. The tenant is responsible for operating expense increases over the base year amount.
Triple net (NNN): A lease in which there is a provision for the tenant to pay, in addition to base rent, their proportionate share of costs associated with the operation of the property. Generally these costs are taxes, insurance, common area maintenance.
Consider your negotiating power
Your negotiating power is as important as finding the right space. Working with an experienced broker helps with much more than the search. From risk mitigation, expansion strategy, termination rights, renewal options, flexibility and buildout, a broker is well versed on the all aspects of real estate—and how they impact your business strategy.
And best of all, there's no fee. In fact, the landlord assumes that tenants will have a representing broker. The landlord and tenant broker then split any fees.
Get the full high-growth guide for a deep dive into these questions and more. Print it out, share with colleagues and find the best space in Chicago for you.
Ready to get started? Our Chicago Tech Practice Group is here to help.
Editors: Laurel Miltner, Michael Cronin