The comeback for the vacated AT&T headquarters in Hoffman Estates began in 2018 near the Jersey Shore. That’s where officials from the northwest suburb checked out another hulking AT&T facility that had fallen on tough times.
Instead of remaining barren and forlorn, the site had been turned into a vibrant commercial hub called Bell Works, with thousands of employees and customers. In a building that once housed the Bell Labs research and development park emerged a modern town square, focused on a walkable “main street” with restaurants, shops, and a farmers’ market. Also in the mix: customized spaces for business offices, corporate meetings, entertainment, and community get-togethers.
Hoffman Estates mayor William McLeod, who went on the New Jersey trip, says the delegates were impressed: “It created quite a buzz.” Soon after, Hoffman Estates leaders urged Bell Works’ developer, now known as Inspired, to re-create its concept at the suburb’s 150-acre AT&T location, which closed in 2016. Bell Works Chicagoland, which cost about $200 million to build, has been up and running since 2020 as a growing blend of offices, stores, eateries, and public spaces within a neighborhood setting.
It’s a lesson in how suburbs can revitalize empty office complexes and corporate campuses after the companies that built them move elsewhere — something that’s happening with increasing frequency. Determining the fate of hefty parcels that once delivered millions of dollars in tax revenue is a challenge confronting a number of suburbs, including Deerfield, Glenview, Lincolnshire, Riverwoods, Schaumburg, Morton Grove, Naperville, and Oak Brook. And Crain’s Chicago Business recently reported on several large cash-starved office complexes in Lisle and Rosemont whose fates are up in the air.
Such towns are dealing with the reality that the decades-old suburban office bonanza is over. At the beginning of 2023, the area’s suburban vacancy rate was 26 percent, the highest in recent memory, according to Colliers, which tracks commercial leases. Employees are now working remotely or coming into the office less often, drastically reducing the need for conventional workplaces and long rental agreements.
Even before the pandemic, Motorola Solutions and McDonald’s sold their suburban headquarters and relocated to smaller digs in Chicago to adapt to new worker schedules, cut costs, and trim and realign staffing while leaving insular office campus life behind. McDonald’s sought to connect with younger, tech-oriented workers and customers by ditching its 74-acre Oak Brook campus for a smaller HQ in the West Loop in 2019. Also looking to tap urban tech expertise, Motorola Solutions relocated from Schaumburg to the Merchandise Mart in 2016. More recently, Allstate left its sprawling Northfield headquarters for smaller digs across the street, and Baxter International spun off its 101-acre home near Deerfield, also intending to downsize. Alight Solutions, a benefits administrator, is moving from Lincolnshire to the West Loop as it, too, slims down its footprint.
One popular option for filling these vacancies: companies acquiring, demolishing, and replacing office campuses and towers with multibuilding logistics hubs that will rival Amazon’s 200-acre distribution center in Kenosha, Wisconsin. That metamorphosis is underway at Allstate’s former 232-acre site (since annexed by Glenview), which sold last year to a Nevada investor group for about $232 million. The insurance giant’s home since 1967 is becoming a 10-building trucking and warehousing complex.
So far, that development is proceeding smoothly. The same isn’t true in Deerfield and Riverwoods, which border the Baxter site acquired last year by Chicago-based Bridge Industrial, an e-commerce supply chain company. Bridge intends to raze the Baxter headquarters and build a 24/7 transit and manufacturing hub capable of handling 300 trucks a day. That plan is sparking furious protests from the suburbs’ affluent residents, who argue the project means greater traffic congestion, declining property values, and public safety risks.
Bridge counters that its plan will replace Baxter’s outdated buildings with energy-efficient, state-of-the-art facilities that generate more tax revenue. Bridge gave up on trying to win Deerfield’s approval (it wanted the suburb to annex a portion of the project’s land), but since the site is in unincorporated Lake County, the company is hoping the county board will support its effort.
Other suburbs have similar misgivings about turning over too much acreage to logistics, warehousing, or manufacturing facilities. While they’re eager to bring in jobs and lucrative operations, they’re nervous about losing their civic identities as corporate headquarters or seeing their quiet bedroom communities become hotbeds of noisy commercial traffic and industry. One example: Naperville cited concerns about its standing as an office-based research and development center to boost the regulatory bar on new manufacturing projects. Its recently elected mayor, Scott Wehrli, has directed the city staff to review zoning codes to ensure the municipality is safe from overzealous industrial schemes. “If you start tearing down these buildings, you can close off the future to whatever comes next in research and development,” says Christine Jeffries, president of Naperville Development Partnership.
Preservationists fret about dismantling important mid-20th-century architecture such as the Baxter campus, designed in 1972 by Skidmore, Owings & Merrill. Landmarks Illinois is keeping an eye on such sites, including Glenview’s onetime Scott Foresman headquarters and the former Avon factory in Morton Grove, says advocacy manager Kendra Parzen.
The nonprofit preservationist group prefers turnarounds such as Bell Works Chicagoland, designed by the eminent local architectural firm Lohan Associates. The project has attracted new tenants while preparing to add up to 550 residential units, notes Inspired CEO Ralph Zucker, who sees parallels between his New Jersey and Hoffman Estates sites. “The original Bell Works started with great bones and potential. When I walked into the AT&T campus, I saw a lot of similarities,” he says.
Hoffman Estates, though, still has another white elephant to deal with: the largely vacant 273-acre headquarters of the once-mighty Sears, Roebuck & Co. That’s been on the block for more than a year. For Hoffman Estates and many other suburbs, the challenge will be filling up such vast spaces without giving away the store.