Challenge

B&F Construction Code Services occupied 26,000 SF of Class C space at the Northwest Corporate Center in Hoffman Estates for 20 years. After previously working with two other tenant representatives, B&F hired Jason Simon and Peter Block of Colliers International to provide strategic real estate services.  B&F was evaluating an early renewal of its lease or relocation to a new headquarters location. Over the course of B&F’s 20 years at Northwest Corporate Center the company had grown in multiple phases from 3,500 SF to 26,000 SF, ultimately causing the space to be inefficient and aesthetically inconsistent. B&F’s focus was to increase space efficiency, maximize lease flexibility, and upgrade their work place environment. Adding difficulty to any potential lease transaction, B&F wanted to grow the size of its premises into upgraded space but decrease their annual real estate spend.

Strategy

Since B&F had previously worked unsuccessfully with two other tenant representatives who could not locate a suitable facility, the Colliers team knew it had to think creatively and uncover unique properties for B&F’s consideration. Colliers’ market knowledge allowed the team to quickly identify a short list of relocation alternatives for B&F’s consideration, several of which were industrial properties with a heavy office component. 

Results

After identifying an industrial building in Elgin, IL that had a 32,755-SF office space, Colliers leveraged a lease renewal against a relocation to generate best and final offers with each building. Although the relocation space was 26% larger than B&F’s existing space, Colliers was able to secure a 12% annual rental cost reduction on B&F’s behalf, even when including relocation costs to the new facility. B&F eagerly accepted an opportunity to secure a larger headquarters location with more favorable economics. The new 11-year lease also provided B&F with rental abatement, multiple expansion options, a termination option, a large construction allowance and rights to assign or sublease their space throughout the lease term. Colliers remains B&F’s advisor and the company is currently evaluating a 15,000-SF expansion into contiguous space at the property.