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CHICAGO MARKET OUTLOOK Q3 2012
Signs of Life Continue
Chicago’s economy – along with the downtown office leasing market – continue to show signs of life.
Important indicators, like unemployment, vacancies, absorption, and rental rates, continued to improve this quarter. We’ve seen demand from historically suburban-based
companies like Sara Lee, Google and others, relocating downtown. And, we’ve seen increased demand from technology companies as Chicago focuses on building jobs in this sector.
The Chicago Economy
Chicago’s unemployment rate fell to 9.4% at the end of Q3 2012, the lowest rate since 2008. This may be a hopeful sign for the Chicago economy, but it is still well above the state and national average.
Though we’ve seen some improvement in the Nonfarm Payrolls prints over the last few months, there are not enough jobs to sustain a strong recovery, and therefore, a strong landlord market. A significant proportion of those jobs, however, are in occupations whose growth bodes well for the CBD real estate market. One analysis shows that as much as 17% of available jobs are in information technology fields, with 13% in management, 10% in office and administrative support, and 8% in business and financial. With job gains distributed among these fields, even small …
Read more...CLIMBING MT. RAINIER
Climbing a mountain and building a successful, robust business have many similarities.
Listen to my interview on the Career Clinic to hear about my recent summit of Mt. Rainier.
Podcast – Mt. Rainier interview wit h Maureen Anderson of the Career Clinic
Next week we’ll write about where building a business and climbing a mountain intersect.
Read more...SCHENK ANNES TEPPER CAMPBELL RELOCATES AND RENEWS AT 311 S WACKER DR
Chicago, IL – November 16, 2012 – Chicago-based law firm Schenk Annes Tepper Campbell Ltd. recently renewed their lease and will be moving to new space of approximately 9,000 rsf of space at 311 S. Wacker Dr.
Schenk Annes Tepper Campbell Ltd. (SATC) has been a tenant at 311 S. Wacker Dr. since 1997. As the firm grew and took additional adjacent space, however, its office configuration became awkward and inefficient. “In a market like the current one, a tenant like SATC is pure gold: they’ve been a reliable tenant for 15 years and are actually growing when other firms are shrinking,” said Rhea Campbell of Bella Terra Partners, who represented SATC in its lease negotiations. “This is why I was not surprised that several other West Loop buildings negotiated hard for their tenancy.” Only when the firm committed to an exhaustive full-market search and decided they were fully prepared to leave the building did 311 S. Wacker offer a compelling deal structure, making a renewal not the path of least resistance, but rather a perfect fit. “SATC was able to grow by the amount needed to accommodate its new partners and associates as well as to create efficiencies that …
Read more...WHAT LIES AHEAD IN 2013
Rental rates across the country continue at historic lows and landlords continue to offer attractive concessions packages to attract or retain an office user’s tenancy. Will these advantages for tenants continue to prevail in 2013? Across the country, the office sector has shown signs of improvement in 2012. Our expectation is this will continue incrementally and unevenly throughout 2013. In other words, the recovery is expected to move at a snail’s pace and may even deteriorate in 2013. The impending Fiscal Cliff and tax climate continue to present headwinds. Deloitte echoes this sentiment in their recent Commercial Real Estate Outlook report saying,
“the impact of European uncertainty on U.S. capital markets may act as a damper. While average rents are likely to grow, a more robust recovery is not expected to begin until 2015.”
What does that mean for occupiers of office space? Landlords are still hungry for your business. The ball is in your court.
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OUR MAGNIFICENT CITY
Cityscape Chicago from Eric Hines on Vimeo.
Read more...“Cityscape Chicago is a personal timelapse piece consisting of over 30,000 still photographs shot on the Canon 5D Mark III incrementally between July and October 2012 around downtown Chicago, Illinois.
The inspiration of this piece was my fascination with the city of Chicago, particularly at night. For me, there has always been a mysterious sort of feeling to Chicago at night, so I decided to explore and capture it.”
SPACE MATTERS – MORE THAN YOU MAY THINK
Most of our clients understand the impact their office space can have on employee retention, morale, collaboration, productivity and recruiting. However, no one understands this better than Prophet. Prophet is a strategic brand and marketing consultancy with offices around the globe – so understands this at a level unmatched by other industries. Their experts work to drive brand relevance in complex ecosystems, gauging how their clients’ brand impacts customer behavior in a given category. They simply understand brand, culture and position better than most. As a result of this they wanted office space that was perfect for their brand and culture.
After understanding workflow, culture, cross business unit collaboration and possible efficiencies that support the necessary aesthetic, we completed an exhaustive search of the Chicago market and found the perfect space!
In fact, Crain’s Chicago Business thinks they have one of the coolest office spaces of 2012.
We think so too!
WE’RE GROWING AGAIN!
We recently added two new professionals (see our press release below for the details)!
Chicago, IL – August 28, 2012 – Bella Terra Partners, a boutique tenant representation commercial real estate firm, recently added two new tenant representation professionals to their team.
Michael Lickerman joins Bella Terra Partners as a Managing Partner. He will not only work as a tenant representation advisor, but will also oversee the firm’s soon-to-be suburban office. “Mike brings a depth of experience in solving legal and business problems to our firm,” says Ms. Rhea Campbell, Founding Partner of Bella Terra Partners. “He has a proven track record in assisting businesses with real estate purchases and sales, leasing and leasehold buyouts, sale leasebacks and complex lease negotiation and structuring.”
James Harrington joins Bella Terra Partners as an Associate Director. He will work exclusively as a tenant representation advisor helping Chicagoland companies think creatively about the use of their real estate and how it can support their current and future business initiatives. Ms. Campbell says, “Jim’s extensive experience in business-to-business sales environments, coupled with his brokerage advisory skills will allow him to quickly understand a company’s pain points.”
Mr. Lickerman is a graduate of Northwestern University and The University of Pennsylvania …
Read more...TO SUBLEASE OR NOT TO SUBLEASE?
The moment has come. For months, you’ve been doing all kinds of creative things with that extra office space. Maybe you had your firm’s holiday reception back there, or maybe you started holding yoga classes at lunchtime. But now you have to face the facts: You don’t need that extra space. Whether it’s the result of downsizing, restructuring, or implementing a telecommuting policy, it’s a millstone, so what are you going to do about it?
If the rent’s fairly low, the space fairly small, and the time left on the lease fairly short, you’re going to have a hard time subleasing this extra space out. You could try to buy it out – offer your landlord a cash settlement in exchange for being released from your lease. Or, if you’d like the space recaptured by your landlord, you can hire a brokerage professional to offer it at market rates in hopes of finding a long-term tenant who would then negotiate directly with the landlord thereby relieving you of your remaining obligation.
But, maybe you’re left with a long-term lease on a sizable space that’s eating up a significant amount in rent, and you really need to offset these financial losses. In …
Read more...OFFICE LEASE ACCOUNTING RULES ON THE WAY
“Lease accounting is one of those things that drive some analysts up a wall, and fixing it has long been on the list of things the accounting rule makers should do. But when they tried, people were furious, and the rule makers went back to the drawing board.
Today the Financial Accounting Standards Board, which sets American rules, and the International Accounting Standards Board said they had reached agreement on a new approach. We’ll see how it flies.” Says Floyd Norris in his article in the New York Times.
Read the Full Article Here
Read more...
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THE PATH AHEAD
Bella Terra Partners’ leadership team approved a five year envisioned future for the organization, as well as a strategy map for the next two years at its recent Annual Meeting. The future plans build a culture and DNA for Bella Terra Partners that leads to perpetual innovation and improved client experience.
We have to be an indispensible resource to our client. We must advance and support the practice of Tenant Representation locally and globally and align our service offering with our client’s corporate needs, establish market driven development and delivery models and identify the core competencies and skills sets that contribute to excellence in the client experience and outcome.
For Bella Terra Partners a five year forecast can be tricky but we believe it is an essential exercise for us to map organization strategy, where we want to be tomorrow and where we want to be in 2017. We’ve set a clear and attainable path ahead and look forward to growing and connecting with our clients, vendor partners and employees!
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