A Guide To Office Relocations Due To Building Redevelopments

In the flux of today’s commercial real estate market, office tenants in Chicago and surrounding suburbs are facing forced relocations as buildings undergo redevelopment to meet modern demands. This situation can present challenges and strategic opportunities for businesses navigating office relocation due to building redevelopment, especially in a tenant-friendly market where high vacancy rates allow for flexibility in leasing terms. Here’s a comprehensive guide to navigating an office relocation due to redevelopment, securing better lease terms, and leveraging expert advice for a seamless transition.

A Few Examples of Redevelopments Leading to Office Relocation

• LaSalle Street Corridor Conversions: In downtown Chicago, the historic LaSalle Street corridor has seen significant office-to-residential transformations, with buildings like 208 S. LaSalle undergoing redevelopment to meet housing demand. This shift has displaced office tenants as mixed-use and residential developments take priority.

• Marshall Field & Company Building: This iconic State Street building is repurposing its upper floors into residential spaces, displacing office tenants as the focus moves to mixed-use functionality in central Chicago.

• Oakbrook Center in Oak Brook: Traditionally a retail and office destination, Oakbrook Center is now integrating residential and entertainment spaces, leading to the relocation of office tenants as suburban markets prioritize multi-use developments.

Key Steps for Office Relocation Due to Redevelopment

Relocation due to redevelopment offers tenants an opportunity to capitalize on current market trends and secure advantageous lease terms. Here’s a detailed look at each step to maximize the benefits of relocation.

1. Evaluate Lease Rights and Negotiate Terms for Relocation Assistance

Review your lease carefully to understand your rights in case of forced relocation. Many leases include clauses on redevelopment and relocation, often specifying notice periods and potential relocation assistance. Common considerations include:

• Relocation Assistance: Depending on your lease, landlords may be required to cover relocation expenses, offer temporary rent adjustments, or even fund build-out costs in a new location.
• Rent Abatement and Concessions: In a tenant-friendly market, many landlords are open to negotiating rent abatements or temporary concessions to retain high-quality tenants.

A skilled real estate broker can help you navigate lease terms, ensuring your relocation is financially manageable and strategically beneficial. If your office building faces financial instability—a common situation in today’s market—it’s critical to relocate to a more stable property where your business can thrive.

To understand the importance of a landlord’s financial health, see why a landlord’s financials matter.

2. Find Better Office Spaces and Leverage Current Market Conditions

High vacancy rates mean tenants have substantial leverage when looking for new office space. Brokers familiar with the local market can help tenants secure high-quality office spaces at competitive rates, often with favorable lease terms. In today’s market, landlords may offer additional benefits, including:

• Tenant Improvement Allowances: These allowances help customize new office spaces to meet business needs. Brokers can negotiate this support, allowing for enhanced office layouts at reduced costs.
• Flexible Lease Terms: Options such as short-term leases, renewal rights, and expansion clauses give tenants the flexibility to adapt as market conditions or business needs change.

With the help of a knowledgeable real estate broker, tenants can even access off-market listings, allowing them to find high-quality spaces not available through standard listings.

3. Prioritize Lease Flexibility in Your New Space

In uncertain times, having a lease with built-in flexibility can be crucial. When selecting a new space, work with your broker to negotiate terms that allow for adaptability, such as:

• Short-Term Lease Options: Shorter leases provide flexibility in a changing office market, allowing businesses to adjust to future needs without long-term commitments.
• Expansion and Early Termination Clauses: Renewal rights, expansion options, and termination clauses offer tenants stability while allowing room for growth or downsizing.

An experienced real estate broker can guide you through the process of structuring leases to accommodate your evolving needs, ensuring your new office space supports both current and future goals.

4. Plan the Logistics of Your Move to Minimize Disruption

Successfully relocating an office requires careful logistical planning. Here are essential steps to keep operations running smoothly during the transition:

• Establish a Timeline: Coordinate with your landlord and moving team to create a timeline for packing, setup, and operational readiness in the new space.
• Hire Experienced Movers: Choose a moving company with a track record in office relocations to minimize disruptions and protect valuable equipment.
• Maintain Business Continuity: Consider temporary workspace solutions or staggered move-in dates to ensure minimal disruption to your business activities.

Real estate brokers often have trusted connections in the industry and can help you find reliable service providers to handle the logistics of your relocation efficiently.

Turning Relocation into an Opportunity with Expert Guidance

Forced office relocation due to building redevelopment can be challenging, but it also provides a chance to secure an upgraded space and better lease terms. Tenants can turn this transition into a strategic opportunity by partnering with an experienced commercial real estate agent. With deep expertise in Chicago’s office market, our skilled Van Vlissingen and Co. team can help you find new spaces, negotiate terms that meet your long-term goals, and secure a lease that supports growth and flexibility.

Working with legal counsel is also critical to ensure that all aspects of your new lease protect your business interests. With the right broker and legal advisor, office tenants can capitalize on current market conditions, securing ideal office space to support operational efficiency and long-term success.

Why Our Agents Stand Out

Our agents are at the forefront of modern office space trends, focusing on creating work environments that align with the evolving needs of businesses and employees in a market dominated by buyers and tenants. As companies adapt to the post-pandemic landscape, we help curate workspaces that support hybrid work models, ensuring spaces are adaptable, innovative, and future-proof. We specialize in repurposing older buildings into experiential workplaces that employees want to return to, turning distressed assets into competitive, desirable office spaces. We guide investors toward properties with robust tenancies, even in a market with an oversupply of space, ensuring long-term value and occupancy.

• As Vice President of Sales and Leasing, Gordon Lamphere J.D. leads our office real estate brokerage team with a forward-thinking approach.
• His advice is regularly featured in local and national press, and industry leaders recognize him for his expertise in adapting office spaces to the changing market.
• Gordon hosts Chicagoland’s Top Commercial Real Estate Podcast (The Real Finds Podcast) and is globally recognized for his expertise in transactional and commercial real estate marketing.
• He is deeply involved in transforming office spaces into resilient and experiential workplaces that attract and retain employees, providing investors with stable, long-term tenancies in a buyer and tenant-driven market.