One of the biggest speculative suburban office developments since the real estate bust of the late 1980s is likely to be coming to Schaumburg, spurred by heavy corporate demand for top-class space in a time of economic expansion.
Chicago developer Steven Fifield said he plans to build three seven-story office buildings totaling 540,000 square feet along with two five-story hotels totaling 200 rooms on 35 acres at Meacham Road and McConnor Parkway. The land was once the site of the Unocal Corp.’s regional headquarters.
The $75 million project, to be called Windy Point, was given preliminary approval Tuesday by the Schaumburg Village Board. Fifield said he hopes to start construction on the first 180,000-square-foot office building next spring.
That timetable might be premature, however.
Village Trustee Jack Sullivan, chairman of the village board’s Planning, Building and Development Committee, said he was under the impression Fifield’s plan was in the early stages and that construction could be as long as two years away.
“This is all a tentative plan,” Sullivan said.
That such a project is even being proposed is a sign of how hot the suburban office market has become in just the last year or so.
Vacancy rates for the best–“Class A”–office space have plunged to about 5 percent in the Schaumburg area–which for larger tenants means there is virtually no room left.
For Fifield, who suffered a series of reversals after the late 1980s, when buildings he developed were foreclosed, the project would mark a triumphant return.
“It’s fun to be back plying my trade, because I know office buildings well,” said Fifield, who is president of Chicago-based Fifield Realty Corp.
Sullivan said Fifield is a reputable developer who has built successful projects in Schaumburg.
“Apparently, he’s got it back together,” Sullivan said.
In fact, Fifield was responsible for the last major new office construction in Schaumburg, the One Century Centre and Two Century Centre office complexes completed in 1990.
Those projects also were built on land once owned by Unocal, a California oil company that had its regional headquarters in Schaumburg until the firm closed the office more than three years ago. Unocal’s former building now houses the Albert A. Robin Campus of Roosevelt University.
Fifield said he has a contract to buy the 35 acres, but hasn’t yet closed on the deal. He is reportedly set to pay more than $7 million for the land.
In roughly the last year, some suburban speculative building of offices has been going on, but it has been mostly in the East-West Tollway corridor.
New development in Schaumburg would indicate that high demand is spreading to other parts of the region, industry observers say.
Leasing activity is up, and rents are rising in all suburban markets to a level where putting up new buildings makes sense, said John Moysey, Chicago regional manager for Northbrook-based Grubb & Ellis Co., a national commercial real estate services firm.
“We’re anticipating a significant level of interest in new speculative development in 1998 in certain market areas, including Schaumburg,” Moysey said.
