Developer Related Midwest and Sidley Austin, one of the city’s largest law firms, announced plans this week for Sidley to anchor a new 45-story tower to be built in the West Loop, at 725 W. Randolph St.
Assuming Related can secure financing, this will be downtown Chicago’s first new office building to begin construction in more than six years — an astonishingly long period of time that says volumes about how traumatic the pandemic and its aftermath have been for our central city.
In moving west, Sidley will leave a tower built for the firm just two decades ago in the middle of the Loop. That 40-story building, at 1 S. Dearborn St., will be left more than half empty upon Sidley’s departure in 2030.
That will deal another major blow to the Loop business district, following the departure of Citadel from its former headquarters and namesake tower at 131 S. Dearborn St. Citadel founder and CEO Ken Griffin, of course, famously moved the company’s headquarters to Miami from Chicago in 2022 after criticizing city and state political leaders for not doing enough to reduce violent crime in the city. That former Citadel Center sold earlier this month to a company specializing in acquiring distressed properties. The price was $137 million, just one-fourth of the $560 million it fetched in 2006.
The remnants of Citadel in Chicago have relocated to a far smaller space in a building north of the Chicago River.
As much as the creation of another big hole to fill in a relatively new Loop building, the pain of Sidley’s move will be felt in terms of noticeably less activity in the traditional heart of downtown. Sidley employs more than 1,500 at the Dearborn location, and they’re required to be in the office four days a week.
In a few short years, those employees will join the lively scene in the West Loop. Few would describe the Loop itself in such terms during most of the workweek as it stands today.
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But time marches on, as do market forces and the desires of corporate tenants.
Back in 2003, as Sidley’s leaders were scouting locations for a new Chicago headquarters, they asked their employees where they wanted to work. The overwhelming response, according to Crain’s Chicago Business, was to be close to state and federal courthouses and Loop restaurants and shopping.
Well, the courthouses are still there anyway.
Regarding the West Loop, Brian Fahrney, chair of the firm’s executive committee, told the Tribune, “We like the proximity to the trains and vehicular traffic, and at the same time you’ve got world-class restaurants and hotels.” He added, too, that “a lot of our talent lives over there.”
In other words, that’s where the action is. Lawyers needing to get to the courthouse can Uber or catch a cab.
To be clear, the well-established business, nightlife and residential scene in the West Loop and Fulton Market are nothing but positive for Chicago, and plans for any new addition to the city skyline are welcome. We are all for cranes in the sky, to use an informal metric of current choice.
And it’s not as if the news is all bad in the Loop. The construction of Google’s Midwest headquarters in the former Thompson Center will be complete next year. Financial data firm Morningstar, which is discussing leasing 300,000 square feet in the Thompson Center alongside Google, has stringent in-the-office requirements similar to those of Sidley, so foot traffic in that part of the Loop could well feel like pre-pandemic times if that deal is completed.
JPMorgan Chase, the largest bank in Chicago, has undertaken an ambitious renovation of its 57-year-old tower in the Loop, just across Dearborn Street from Sidley Austin. Chase CEO Jamie Dimon is an ardent proponent of working in the office, and more than 7,000 bank employees are based in Chase Tower. The beginnings of post-COVID recovery are there.
We’d like to see more revival and repurposing of the Loop’s existing office buildings similar to what Chase is doing. Even at a hefty discount, the purchase of the former Citadel Center is a good sign along those lines. Boston-based consultancy Bain & Co. already has signed for much of the space formerly occupied by Citadel, and Chase has stashed some of its workers at the old Citadel building via a short-term lease while the renovations are proceeding.
We’re on the record in support of efforts to convert offices in Chicago’s old financial district on LaSalle Street into residences and hotels and have wished those efforts would proceed more quickly.
But it’s hard to imagine the Loop as a vibrant city core again without office workers. We’ve seen how the buzz of the West Loop helped lure Sidley just across the Kennedy Expressway (which we should have capped, by the way, when the Jane Byrne Interchange was rebuilt).
Activity begets activity. Let’s hope Google and Chase’s commitment to old-school downtown Chicago has a similar multiplier effect.
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