Atlantic Trust Extends Lease at 1 S. Wacker

CHICAGO-Atlantic Trust Group Inc. has extended its lease for 26,195 sf of office space at 1 S. Wacker by 10 years, earning a build-out of their space in the deal due to competition by landlords Jones Lang LaSalle and Tishman Speyer, owner of the AT&T Corporate Center, for the investment counseling firm. The company, formerly known as Stein Roe Investment Counsel LLC, is a subsidiary of United Kingdom-based mutual fund manager AMVESCAP.

Atlantic has been in the 24-year-old building for 22 years, but its lease was up in 2009. Due to the tenant’s market for Downtown office space, was able to several alternate buildings as its lease was nearing completion, says Lisa Davidson, executive managing director at Studley. She represented Atlantic in the deal, along with executive vice president John Goodman.

“They started the search a few years ago, they felt the market was soft, though the West Loop area has the most demand of the Downtown area,” Davidson tells GlobeSt.com. “They found an ideal space at the AT&T building, the landlord was willing to make a deal. The space was already built-out and they were going to give us a rent abatement and more to cover the remaining lease obligation. We were very close to moving, that’s what forced this aggressive deal.”

The company had about 37,000 sf in the building on two separate floors, Davidson says. With this lease, Atlantic will consolidate its main requirement for 26,195 sf onto one floor, and will keep subleasing the other 10,000 sf from Bank of America through 2009, with an option to renew, she says.

Neither Davidson nor a spokeswoman for JLL would comment on the exact new lease rate for Atlantic, though Davidson says the average lease rate in the building is about $16 per sf in the low floors and about $18 per sf in the high-rise area, where Atlantic is located. Davidson says the firm will move into swing space, and JLL will do an entire build-out of the recently-leased space. The build-out has already started, Davidson says, and Atlantic will move back in during the second quarter of 2007.

She says this was a good time to sign up for more space, as landlords are expected to gain ground in 2007 in Downtown Chicago, and lease rates may be ready for an up-tick. “I wouldn’t say it’s going to be a landlords market, but vacancy rates are starting to go down, next year will be tighter.”