Sidley Austin is moving its Chicago office to a 45-story tower that Related Midwest plans on the edge of the fast-growing Fulton Market neighborhood, with the law firm set to anchor what will be the city’s first office skyscraper to break ground in more than six years.
The developer and law firm announced Tuesday that Sidley will move to the 1 million-square-foot building at 725 W. Randolph St. by late 2030. The statement announcing the plan did not disclose exactly how much space the firm plans to lease, but it is believed to be more than 500,000 square feet, according to people familiar with the situation.
Sidley currently leases about 544,000 square feet in the 40-story tower at 1 S. Dearborn St. in the Loop business district through 2030, according to the firm.
When financing is secured, Related Midwest will start construction of the city’s first major downtown office tower since developers including Hines and the Kennedy family launched the 60-story Salesforce Tower on the riverfront Wolf Point site in the early weeks of COVID-19. Big, ground-up office projects anywhere in the country have stood out since the pandemic’s arrival in early 2020 led to historically low demand for corporate space.
But the newest, highest-rent towers have outperformed the overall leasing market in Chicago, with virtually no available space. That has led big, blue-chip tenants such as Sidley to find few available options for large spaces in existing buildings.
Sidley explored options such as revamped space in Boeing’s former headquarters at 100 N. Riverside Plaza before choosing to anchor a ground-up project.
“Chicago has been central to Sidley’s history for more than 160 years and our move to 725 Randolph reflects our continuing commitment to Chicago,” Brian Fahrney, chair of Sidley’s executive committee, said in the statement. “We look forward to serving clients from our new home in one of the nation’s fastest-growing commercial districts, one that is vital to the future of the Chicago business community. The quality of our work, the strength of our teams and the unique culture that defines Sidley’s Chicago office will remain central to our firm as we begin this next chapter in our founding city.”
Related Midwest’s planned Randolph Street tower is designed by architecture firm Kohn Pedersen Fox, featuring a large outdoor terrace with skyline views.
Law firms making moves
Sidley said it has more than 1,500 lawyers and professionals in Chicago. Globally, the firm has about 2,300 lawyers.
“In connection with his plans and designs for Chicago, Daniel Burnham is noted for his saying ‘Make no small plans.’ Our move to Fulton Market is in keeping with our adherence to this idea and our continued bold investments in major business centers globally,” Chris Abbinante, co-managing partner of the law firm’s Chicago office and executive committee member, said in the statement. “Following recent office moves in San Francisco and Dallas, and with new offices planned in state-of-the-art buildings currently in development in Washington, D.C., and Los Angeles, we are continuing to locate our firm to meet the needs of our clients and our people as well as where the opportunities for growth are strongest.”
Salesforce Tower broke ground with the namesake committed to lease 500,000 square feet in the more than 1.2 million-square-foot tower. During construction, law firm Kirkland & Ellis signed on to lease most of the remaining space.
Last year, Salesforce Tower’s developers refinanced it with a $610 million loan that valued the property at $888 million.
Related Midwest’s statement did not provide a timeline for construction or expected cost of the Randolph Street project.
Financing expected soon
Related Midwest President Curt Bailey told Crain’s Chicago Business, which earlier reported on the deal with Sidley, that the developer expects to secure financing for the project and start construction soon.
“725 Randolph will be an unparalleled offering that transforms the workplace experience,” Bailey said in the statement. “We are proud to welcome Sidley, an industry leader and global law firm, as the anchor for our next iconic office environment. This will be the go-to building in the city’s premier submarket for their team to grow and thrive in this new milestone.”
Chicago-based Related Midwest, part of New York-based Related Companies, is one of the most active developers in Chicago.
Ongoing projects include a 72-story apartment tower at 400 N. Lake Shore Drive, a quantum computing campus on the site of a former U.S. Steel plant on the city’s south lakefront and The 78, a mixed-use development along the river in the South Loop. Within that site, Major League Soccer’s Chicago Fire broke ground on a 22,000-seat stadium earlier this year.
Related Midwest previously proposed multifamily and hotel uses on the site at 725 W. Randolph, and the firm still must secure a zoning change from Chicago’s City Council to break ground on the project for Sidley.
For the record
The tenant is represented by CBRE broker Todd Lippman.