Landlords Preparing For Tenants' Return By Activating The Streets And Adding Green Spaces
As more people begin planning for a return to the downtown, some developers envision transforming the market with more outdoor spaces, permanent changes that will give workers and residents a feeling of security in a post-COVID world. Vaccines may curtail the virus’s spread, but worries about disease could persist, and properties with outdoor green spaces may have an advantage.
“We have to keep moving forward and prepare for a post-COVID world,” Peppercorn Capital owner and founder Phil Denny said.
His firm, which owns a large number of properties across the West Loop and Fulton Market, will take advantage of a vacancy at its 80K SF 240 North Ashland Ave. in West Fulton Market and transform its west side, adding green space and a new tenant entrance. Denny said 601W Cos.’ transformation of the Old Main Post Office’s rooftop into an amenity-rich green space is his inspiration.
“It’s going to be more than just a green space; we want tenants to be able to use it for sports, hold meetings and eat outdoors,” Denny said.
Housewares company Crate & Barrel and its furnishing division CB2 once occupied most of 240 North Ashland Ave., using much of it as a photographic studio, but they left last April for a bigger space in The Fields on the northwest side. Denny said the building, completed in 1926, will undergo a $2M renovation. The effort will include installing lighted metal canopies along its east side on Ashland Avenue and refurbishing its distinctive clock tower.
Denny added that he owns roughly half of the buildings on the 1600 block of nearby Carroll Avenue, a collection of low-rises occupied by many manufacturers and small shops, and those tenants will be able to use the renovated green space at 240 North Ashland Ave. as well.
“It will be the hub of my portfolio in that part of the West Loop,” he said.
Although Fulton Market has been emptied out as thoroughly as the Central Loop during the pandemic, Denny said its smaller structures and more open spaces mean more comfort for office users and a quicker return to buildings like 240 North Ashland Ave.
“We’ve got a lot of natural light here, and a grand staircase that makes it easy for people to get around without cramming into an elevator,” Denny said. “I think people are going to be eager to get back to a routine, especially to buildings with amenities like we have in Fulton Market.”
Other street-level amenities are on the way. Developer Sterling Bay licensed space to local fitness startup BOLD to open modular fitness pods at 1000 West Carroll Ave. in Fulton Market, according to BOLD founder Jake Goldstein. He is outfitting a group of shipping containers with fitness equipment and plans to rent them out to residents and professional trainers by the hour.
In addition to fan bikes, indoor rowing machines and power rack systems, he said, each pod will have its own commercial-grade air filtration system. That will allow users to avoid packed gyms.
“Even though you’re not really sharing air with anybody, we will still have hospital-grade air quality,” Goldstein said.
The 320 SF shipping container training pods should outlast COVID-19, he added. Each will contain high-definition screens and audio for streaming guided workouts, allowing homebound consumers to avoid spending thousands on at-home systems like Peloton, Mirror and Tonal.
“It’s also going to be a very cost-effective option for trainers, who can bring their clients here rather than a gym,” Goldstein said. “We think this is a completely new category of fitness bridges the gap between brick-and-mortar gyms and digital fitness.”
Goldstein launched BOLD in collaboration with Chicago-based early stage investment fund Motivate Venture Capital. He’d like to eventually expand to Miami and Los Angeles, but for now will concentrate on growth in Chicago, perhaps first expanding to neighborhoods such as Lincoln Park and Old Town.
Downtown owners are also remaking their outdoor spaces as they anticipate office workers’ eventual return. The Aon Center’s first-level plaza at 200 East Randolph St. will receive a $6.5M renovation that will connect it to Millennium Park, according to statements made this week by officials from The Telos Group, a broker for owner 601W Cos.
“Aon Center has spent the past several years creating value for our tenants and the plaza reconstruction is an extension of this strategy,” Telos Leasing Director Caroline Colnon said in a press release. “We’re building a stunning new outdoor space that will help bring Aon Center employees back to their offices.”
Demolition began this month and Colnon said construction will be completed by late summer. The remade plaza will include new seating and gardens and will be open to the public.
“The plaza will become a welcoming space that extends the greenery of Millennium Park right up to Aon’s front door,” Colnon added. “We expect this to be a gathering spot for people and for it to meet the needs of our current and future tenants.”