That’s good news for downtown office owners struggling with near-record vacancy rates and more businesses shrinking space rather than expanding, given the rise working remotely during the COVID-19 pandemic. Inspire11 is also committed to the Loop, which has suffered the lion’s share of losses, with more than 1.3 million square feet of net tenant moves over the past two years, according to CBRE data.
Mehmeti said his five-year-old company needed more office space to accommodate a workforce that grew by 50% during the public health crisis to 300 people, with more clients hiring the company to help them adapt to changing consumer behaviors during the pandemic. About 200 of its employees are based in Chicago today, and Mehmeti plans to add between 150 and 200 additional workers locally by the end of 2022.
Yet the company is also like many others embracing remote work and trying to find the right office footprint to meet its needs. While 23,000 square feet is particularly small for a company that could soon have nearly 400 local employees, Mehmeti said he expects many of his employees to work remotely about half the week and on-site with clients a day a week. This can lead to overcrowding in his new office on some days, “but we were willing to bet that on those days people would go (to work) in more general areas of the building”, such as the amenity areas of the property of 17 floors. , he said.
“We never forced people into the office (before COVID) because we thought the model was goofy,” Mehmeti said. “The goal was to foster camaraderie.”
He estimates that his business will surpass $70 million in revenue this year. The company ranked fourth on Crain’s 2021 list of Chicago’s fastest growing companies.
After looking at buildings elsewhere in the downtown area, Mehmeti said her company chose pre-built space in the Dearborn building for its proximity to public transportation and the property’s tenant amenity spaces. A more eccentric driver: the company, which has “11” in its name as a nod to fictional guitarist Nigel Tufnel’s amplifier with nobs that “goes to 11” in the 1984 movie “This is Spinal Tap” , was to be the 11th floor in a new building, as it stands today at the Wacker Drive tower. “It’s more about karma,” Mehmeti said.
The Dearborn Street building has stood out in recent years from some of its vintage Loop office peers as proof that businesses will lease space in older properties that have been updated with modern tenant perks . Marketing software company ActiveCampaign, logistics provider FourKites, Chicago Fire FC Major League Soccer franchise and artificial intelligence company Narrative Science were among the companies that signed leases in the building in recent years.
The building is nearly 90% let today, according to real estate information firm CoStar Group, although it also has significant sublet deals, including one from sports betting firm Fubo Gaming, which just sublet Narrative Science’s space last year.
Inspire11 leaves behind a Wacker Drive building that is 80% leased, which is the average for downtown office buildings at the end of 2021, according to CoStar. The 41-story building lost one of its biggest pre-pandemic tenants in insurance company Kemper, which moved to the Aon Center.
New York-based real estate firm AmTrust owns 1 E. Wacker and last year announced plans to renovate it as part of a larger $100 million investment in most of its downtown portfolio from Chicago.
David Knight of Advocate Commercial Real Estate Advisors represented Inspire11 in negotiating the lease. Jack O’Brien and Caroline Colnon of Chicago-based Telos Group oversee leasing at 1 N. Dearborn St.