Another major firm is departing Chicago’s Magnificent Mile and joining the long list of companies flocking to the city’s hot Fulton Market.
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Valor Equity Partners, known for its early investments in tech companies like Elon Musk’s Tesla and SpaceX, will be leaving the former John Hancock Center at 875 North Michigan Ave. for new offices at Tishman Speyer-owned 320 North Sangamon St. Valor will occupy 24K SF on the top floor of the 13-story building, which opened last year, Crain’s Chicago Business reported.
That will nearly double the firm’s square footage. Its two 875 North Michigan leases expire by the end of next year, per Crain’s, and that building’s owner, real estate firm Hearn, is rebranding it as the Mag Mile Medical Pavilion, marketing space for clinical purposes.
Valor is the latest in a flurry of corporate moves to Fulton Market, which has stood in a category of its own for office sales in the wake of the pandemic. The area most recently reeled in law firm Norton Rose Fulbright for its first Chicago office and Boston Consulting Group, set to move into a new Sterling Bay-developed building at 360 North Green St.
It also comes as the Magnificent Mile’s cachet as a major shopping and office destination is fading. On the retail side, the rise of e-commerce and then the coronavirus slowed foot traffic and contributed to the loss of major tenants such as Macy’s, Uniqlo and Gap. Meanwhile, the downtown office vacancy rate crept up to 21.2% in the first quarter of the year, up from 19.7% late last year, according to CBRE. Major defections such as Boeing’s decision to move its headquarters to Virginia are unlikely to improve matters in the current quarter.
A Tishman Speyer spokeswoman told Crain’s that 320 North Sangamon is now 87% leased. On Wednesday, Skender announced in a press release it had completed construction on the interior build-out of a two-story, 54K SF lab and office space for Hazel Technologies, a USDA-funded technology company, in the same building.
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