Apparel company Club Colors agreed to lease 52,000 square feet and establish its national headquarters in Bell Works Chicagoland, the largest deal yet at the former AT&T campus in Hoffman Estates.
It’s a big step forward for Inspired by Somerset Development, the New Jersey developer that bought the empty 1.6 million-square-foot complex in 2019, and envisioned transforming it from a sterile corporate environment into a “metroburb,” a community hub for tenants and residents of the northwest suburb.
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“We all want it to succeed because it’s not just an office building, or even an office building with some retail,” said Hoffman Estates Director of Economic Development Kevin Kramer. “We don’t really have a downtown, so we see this as our downtown, a downtown under a roof.”
Village officials considered a lot of proposals for the vacant property when AT&T left in 2016, including establishing a public university or a retail mall, but Somerset won them over, promising to fill it with revamped offices, public spaces, pedestrian walkways, cafes, other retail and co-working areas, all surrounded by hundreds of new apartments and town homes. It was an unusual suggestion, but the developer had experience. Starting in 2013, the company transformed the former Bell Labs campus in Holmdel, New Jersey, into a 2-million-square-foot, mixed-use complex after attracting dozens of tenants.
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The pandemic put up a big obstacle to the firm’s effort, but with large tenants such as Club Colors back in the market for new space, momentum is returning, Kramer said.
“These 40,000- to 50,000-square feet tenants move the needle,” Kramer said. “Many companies are looking for new spaces where they can grow, but they also need spaces that are attractive where people actually want to go, and that’s Bell Works.”
Heritage-Crystal Clean, an Elgin-based environmental services firm, agreed this spring to a long-term lease at Bell Works Chicagoland, and in August will move its 180 employees into 39,000 square feet. Existing tenants include Platinum Home Mortgage, Headline Solar, CPA Advisors Group, a local mosquito control company and an equity crowdfunding firm.
“The metroburb is unique in our marketplace and we think superior to any other option,” Jeff Baumet, co-CEO of Club Colors, now based in Schaumburg, said in a statement. “This new home allows us to provide amenities such as day care, fitness centers, restaurants and a diverse array of other companies to our entire team, from sales to operations.”
The northwest suburban office market needs a jolt. Its vacancy rate soared to nearly 30% just before the pandemic after several major employers, including Motorola Solutions, left for new digs in downtown Chicago, and hit 34.9% early this year, according to an April report from Colliers International.
But conditions may soon improve, at least for class A properties that provide employees with a lot of amenities.
“Transactions in best-in-class assets are expected to gain leasing momentum throughout 2022 as employers open offices and bring employees back,” Colliers noted.
Kramer said he expects Bell Works Chicagoland will continue attracting firms that don’t want sterile offices. And Hoffman Estates plans to keep promoting it as the center of village social life.
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Several local nonprofits, including the Children’s Advocacy Center and Next Level Northwest, a business accelerator for Hoffman Estates and nearby municipalities, recently hosted fundraising galas inside Bell Works’ atrium.
“This is a unique place for the suburbs,” Kramer said.
