Some Landlords, Leasing Teams Offering New Amenities To Get People Back To Empty Downtown Offices
CHICAGO (CBS) -- Have you ever worked out on gym equipment at the office, or sipped coffee next a fire pit at work?
Experts say flashy amenities may be a remedy for those empty offices downtown. CBS 2's Tim McNicholas showed us how some landlords and leasing teams are thinking outside the box.
A coffee bar with a barista, 12,000 square-foot gym, and nap pods where you can snooze for 20 minutes are among the offerings at 1 S. Wacker Dr. The building at that address is not a luxury apartment building – it's an office building that has those amenities in a new common area.
"My expectation was buildings like this would be cutting back services," said Peter Birnbaum.
Birnbaum and his company, ATG, have leased at 1 S. Wacker Dr. for years. Last month, they expanded to lease even more space - at a time when many companies are downsizing.
"The building here doubled down on services and that made us feel really comfortable with staying here," Birnbaum said.
Nikki Kern is senior vice president of the Telos Group - the leasing team for the building.
"You really have to create an environment that tenants want to come back to," Kern said. "People aren't really coming back to the office right now to go sit at a desk. they can do that at home."
Many buildings are searching for ways to fight the historically high vacancy numbers across the Loop.
"Chicago office market is one of the weakest in the country," said Northwestern University Real Estate Professor Bill Bennett.
Bennett said amenities aren't all that's being offered.
"That means there's heavy concessions," he said. "You can get free rent. You might get some more dollars than has been typical to build out space and deals abound."
Bennett says there have been signs of slight improvement in the market over the past few months--but nowhere near pre-pandemic.
The question is, will that trend continue into 2022? As companies grapple with COVID variants, the answer isn't so simple.
"we'll probably see the bottom whenever a recovery begins to take hold in the post-COVID world," said Bennett.
And the buildings with nothing new to offer might get caught snoozing.