KBS, one of the largest owners of commercial real estate in the U.S., has begun a $22 million renovation at Accenture Tower, a 40-story trophy office tower in downtown Chicago, which will include indoor and outdoor amenities and the addition of 90,000 square feet of speculative suites.
The renovation plans come several months after KBS refinanced the tower with a new $375 million loan. It was one of three major refinancing deals the company did in the fourth quarter of 2020, according to Robert Durand, executive vice president of finance at KBS. The other refinancings included a $123 million loan for The Almaden in San Jose, Calif., and a $28.7 million loan for Crossroads Distribution Center in Charlotte, N.C.
Located at 500 W. Madison in the West Loop, the skyscraper has nearly 1.5 million square feet of office space and two levels featuring 80,000 square feet of retail space. Situated atop the Ogilvie Transportation Center, one of the two main commuter train stations that connect the suburbs with downtown Chicago, the second level of the tower connects directly to the Ogilvie train station.
Constructed in 1987, the building was rebranded as the Accenture Tower in July 2019, when the anchor tenant—Accenture, a global professional services company—increased its space.
Owned by KBS Real Estate Investment Trust III, the tower is a Class A, LEED Gold-certified building. Among the amenities already in the building are a tenant lounge with private wine storage, a 14,000-square-foot two-level fitness center with a basketball court, state-of-the-art conferencing facilities and more than 20 fast-casual and dine-in options.
Planned upgrades will include a new hospitality-inspired office lobby; conference center with pre-function area; modern tenant lounge with 19-foot ceiling and featuring an outdoor deck with a variety of seating options, fire pit, and bar designed by Chicago-based GREC Architects.
Dan Park, KBS senior vice president and asset manager for Accenture Tower, said in a prepared statement these renovations align with top office users in Chicago and will position the property for long-term growth. He said the upgrades will make an already iconic building even more appealing to companies as they return to their workspaces.
David Ervin, managing principle of GREC, noted in prepared remarks the upgrades his firm has designed will make the property even more compelling to companies as they seek superior office space to help them attract and retain talent to remain competitive.
KBS is also continuing its spec suite program by adding 90,000 square feet of spec suites, which involves building out office suites without a committed tenant. The company will be partnering with a local furniture vendor to meet with tenants to create a return to the office design that can be adapted during future phases of their return-to-work strategy.
Park said in prepared remarks the spec suites will enable companies returning to the workplace to have top-tier space immediately without having to wait for renovations and to minimize their out-of-pocket expenses. He said surveys show companies want to return to the office as quickly and as safely as possible.
KBS is also working with Leopardo Cos., a construction and building services firm with offices in Chicago and Hoffman Estates, Ill., on the planned upgrades.
Wendy Katz and Matt Lerner of Stream Realty are handling leasing services.