“Welcome back to a city that’s missed you!” That’s what Chicago’s mayor exclaimed at the September 2022 ribbon-cutting at Accenture Tower, where office workers and visitors were eagerly ready to embrace all the new offerings and renewed appeal of KBS’ iconic 40-story building in the Windy City’s West Loop.
In the wake of the pandemic, people have been on the search for communities and spaces that promise higher quality of life and a wealth of innovation. They’ll find it at Accenture Tower, which has undergone more than $22 million in upgrades, including a new office lobby inspired by the hospitality industry, a state-of-the-art conference center with a pre-function area, and a contemporary tenant lounge with an outdoor terrace with two fire pits in a garden-like setting.
In addition to the new deluxe office amenities, one will find 70,000 square feet of retail and more than 20 fast-casual and dine-in restaurant options on-site. The renovations have helped bring the 1.46 million-square-foot building reach more than 95% in leasing occupancy.
“We’re truly a city within a city from which you never have to leave,” said Julia Horan, vice president of asset services at Transwestern, which manages Accenture Tower. “Tenants and visitors love the convenience of location, the quantity of retailers, the quality of our staff, and the community atmosphere that’s been created.”
Consumers now want to max out on mixing things up, and the more-empowered office worker seeks additional reasons to return to the office. In fact, COVID-19 raised the stakes for office owners. People and companies have become even more attracted to smart, flexible, and multifaceted buildings that offer the opportunity to work, live, shop and play in relatively close proximity.
That’s Accenture Tower, a place that boasts top-of-the-line convenience and connections — the property offers direct, in-building light rail access via Chicago’s Ogilvie Transportation Station — but with what have been called “transformational” amenities.
“Chicago has always been an incredibly competitive market, which was commonly referred to as the ‘amenities arms race,’” said Matt Lerner, executive vice president at Stream, the property’s office leasing company. “It’s become even more important coming out of the pandemic as companies push to entice their employees back to work. For landlords, it’s not about just building out great amenity space, but activating them in a way that is truly engaging. Paying attention to details matters more than ever as we look to make ‘commute worthy’ experiences for our tenants.”
The Rise of Mixed-Use Properties
“All in one,” “from A to Z,” “the whole nine yards” — there are so many ways in which to say something’s “got it all.” Mixed-use developments, those properties that integrate a variety of real estate applications, including retail, office and residential, offer the variety that can spice up life, maximizing appeal and avenues of engagement for consumers.
Tenants embrace mixed-use properties because of the increased ways that consumers can be engaged. Beyond the solo, need-based visit (e.g., picking up dry cleaning), people will patronize an establishment to eat, be entertained, browse, socialize, and simply relax. The more a mixed-use property connects commerce with lifestyle, the more a sense of place and community will be created, building more entry points for the consumer and thus increased likelihood for tenants to get traffic besides that intentional, need-based visitor. And mixed-use developments, with office and residential components built-in, offer daytime and 24-7 populations ready to consume products and services.
Accent on Diversification
Located at 500 West Madison, Accenture Tower was constructed in 1987 atop the historic Northwestern Station connecting downtown Chicago to the northern and western suburbs by rail. It was billed as the city’s first and largest full-service office location — and continues to exemplify the very best-in-class among mixed-use properties.
Over the years, however, the appeal that all paths (and rails) lead to 500 West Madison turned instead into all paths lead through. According to Stream, the property had “evolved into an asset of convenience, serving [merely] as a pass-through point of entry for 180,000 commuters daily.” Dated spaces and lack of other attractive uses led to rising vacancies and a slow but steady decline.
KBS worked with Stream to create a comprehensive marketing, renovation and leasing strategy that made Accenture Tower stand out to the huge commuter crowds and appeal to a diverse tenant base. To provide an “inviting, yet grand first impression,” including leveraging its high ceilings and open views, the lobby underwent a $10 million renovation. Management and security offices were moved from the reception area, and the third-floor space was upgraded with an expanded first-class lounge with a staffed bar, a landscaped outdoor terrace, and a new conference center.
“Accenture Tower does more than ‘check the box’ with the amenities we offer,” Horan said. “We don’t just have a fitness center; we have a 15,000-square-foot fitness club with a half basketball court and personalized fitness training. There’s not just a tenant lounge on-site, we have a full tenant experience program with seasonal and weekly events ranging from do-it-yourself holiday wreaths to wine tasting and pumpkin painting contests. Rather than just a coffee bar, we have a fully staffed, open from dawn to dinner lounge that serves all café offerings in the day, then switches to a fully curated cocktail menu in the late afternoon. Our focus is premier customer service and tenant engagement where our staff not only knows you by name but already has your favorite drink poured.”
KBS has constructed and leased almost 250,000 square feet of spec suites and converted interior storage space into shared tenant lounges to help further distinguish the Accenture Tower offerings from the competition. An additional 90,000 square feet are currently in the pipeline.
The numbers tell quite an impressive story: 350,000 square feet of space leased since the pandemic to achieve 95% occupancy at the property. More than half (54%) of that activity consisted of new deals and expansions, including anchor and title tenant Accenture expanding by approximately 185,000 square feet.
The Class A LEED Gold-certified building won The Outstanding Building of the Year (TOBY) Award from The Building Owner and Managers Association (BOMA), which has represented all CRE property types, including office and mixed-use. That prestigious and comprehensive program grades all facets of a building’s operations from community involvement, tenant relations and site management, to environmental and “green” policies and procedures.
Everyone loves a winner — even better when it involves a comeback story. There’s something special about renewal, too. Like the changing seasons, it fosters fresh feeling but with foundation. The frame of reference, knowing what once was and what is now, brings greater appreciation. In real estate, it’s change for the better, which is aided by a mix of uses that maximizes connection, convenience, and community.
“The new first-class lobby and tenant lounge have dramatically changed the first impression of the building,” said Corey Seigrist at JLL, a tenant who knows more than a little bit about real estate. “Seeing all the activity and vibrancy at the bar in the lounge is a great reminder of the camaraderie we’ve been missing in an office environment.”
Today’s mixed-use properties are setting a new standard for developing engaging spaces. It’s not only a fine fit for office, it’s also perfect timing in an era where office spaces must do more. KBS’ Accenture Tower is leading the way.