The state of Illinois is purchasing a building in Chicago's West Loop in an effort to reduce the state's long-term real estate costs that will culminate in the long-awaited sale of the James R. Thompson Center downtown.
Gov. J.B. Pritzker announced Wednesday that the state has acquired 555 West Monroe for $73.25 million. The state will relocated more than 1,000 employees to the building, including some who work in nearby facilities as well as some who work at the Thompson Center, his office said in a statement.
“The acquisition of 555 West Monroe is an important step in our effort to optimize the State’s real estate portfolio, reduce operating expenses, and enhance workforce and workplace performance,” Pritzker said in a statement. “This building pays for itself because we’re terminating a patchwork of expensive downtown leases.”
The state currently leases office space in seven properties in the Loop for $21.3 million in base rent and operating costs, Pritzker's office said.
The purchase of 555 West Monroe is part of a larger effort to review and restructure the state's real estate portfolio, an initiative in which the Illinois Department of Central Management Services has met with agencies located downtown to understand their physical space requirements before suggesting changes.
Pritzker's office said the CMS found that the real estate footprint could be reduced by roughly 30%, with only 900 state employees requiring a location in the Loop. There are roughly 2,200 employees at the Thompson Center and 1,300 in leased facilities, officials said.
Pritzker signed a law in 2019 authorizing the sale of the Thompson Center, for which sale proposals have been raised for nearly two decades. The 17-story structure that takes up an entire city block opened in 1985 to house state offices but has seen "prolonged deferred maintenance and delayed capital projects," Pritzker's office said.
Pritzker's office said Wednesday that the cost to bring the Thompson Center into "a state of good repair" exceeded $325 million and would increase to more than $525 million by 2026. It also has operating costs of more than $17 million a year.
The final phase of the state's real estate initiative will include the sale of the Thompson Center.
Under the law signed in 2019, potential buyers will have to develop proposals for the property that the state would evaluate before awarding a contract.