Google intends to expand in downtown Chicago with the purchase of the Thompson Center for $105 million

Officials announced Wednesday that Google will take over the Thompson Center in The Loop.

After other organisations renovate the building, the tech behemoth has agreed to purchase the entire structure for $105 million. As part of the agreement, Gov. JB Pritzker said at a news conference that the Thompson Center will be “completely redeveloped” into an office suite for Google employees. According to him, the sale will benefit the company as well as Illinois taxpayers and Chicagoans.

Credit to Armando L. Sanchez, Getty Images

“Google is one of the most important companies in Chicago,” Pritzker said. “You are an important member of our community, and you have invested in your future while we have invested in yours.”

As part of the agreement, the state will receive $30 million in cash and 115 S. LaSalle St., which will be renovated and used by state employees.

Pritzker claims that consolidating Downtown real estate will save taxpayers nearly $1 billion over the next 30 years. He also stated that selling the building to Google will generate tax revenue for the city and bring more life to The Loop.

The Thompson Center will be renovated, but “its iconic design” will be preserved, according to Google executive Karen Sauder. The chairman and CEO of Capri, which will work on the renovations, Quintin Primo III, stated that changes will be made to make the building as energy-efficient, environmentally sustainable, and inclusive as possible.

It’s the latest twist for the famous building, which opened in 1985 and has been used for governmental offices — but has faced costly infrastructure issues, prompting several lawmakers to try to sell it.

Officials revealed few details about Google’s Thompson Center redevelopment plans. However, according to CoStar, which first reported the pending sale in June, Google will set up offices throughout the 17-story building.

According to CoStar, Google has over 2,000 employees in Chicago and offices at 1KFulton, 1000 W. Fulton St., and 210 N. Carpenter St. The tech behemoth has previously stated that it intends to hire thousands more people in cities across the country, including Chicago.

In April, the company welcomed its Chicago employees back to the office.

Helmut Jahn, the famed postmodern architect, designed the Thompson Center, which opened in 1985 as the State of Illinois Center.

As part of the agreement, Illinois will receive $30 million in cash as well as the $75 million property at 115 South LaSalle.

“Over the next 30 years, this consolidation will save Illinois taxpayers nearly a billion dollars,” Pritzker said.

Experts cited Chicago’s Fulton Market District as a model for the footprint Google establishes and rapidly expands.

“We know there’s a tremendous multiplier effect when Google comes here and creates jobs,” said Jack Lavin, president and CEO of the Chicago Chamber of Commerce. “It attracts other tech companies, and that will be a real catalyst for growth here in the Loop and downtown Chicago, especially after the pandemic.”

With corporate traffic still lagging, it’s exactly the kind of allure the Loop requires.

“It makes sense that Google would want to be here, so we expect others to follow,” said Kiana Distasi of the Chicago Loop Alliance. “Google is an amazing market driver, so I think that if Google decides to be in the Chicago Loop, a lot of other people will be looking at ‘hey! What’s going on in the Chicago Loop?’ and they’ll find that Chicago has a lot of appealing things to offer.”

Google will pay $105 million for the much-loved and equally despised James R. Thompson Center in the heart of the Loop and transform it into a second Chicago headquarters, officials announced Wednesday.

The announcement by Google that it would take the Helmut Jahn-designed structure off the hands of the state of Illinois caps a years-long effort to figure out what to do with the 1.2-million-square-foot building at Randolph and LaSalle streets with its distinctive red-and-blue accented steel frame.

The building, named after the former governor, opened in 1985 and quickly fell into disrepair, leaving the state with a $325 million bill for deferred maintenance and seemingly no good options.

Google’s announcement means that the building will not be demolished, which will delight preservationists. It also represents a major victory for Chicago officials, who have been concerned that the shift to remote work will drain vitality from the Central Business District, despite a continuing spike in crime in and around downtown Chicago.

Google’s decision to expand its Chicago operation will help Gov. J.B. Pritzker and Mayor Lori Lightfoot’s re-election bids, who celebrated the tech giant’s bet on downtown Chicago at a news conference beneath the building’s soaring atrium.

“Google’s announcement today of their expansion is a huge win for the city of Chicago and Illinois taxpayers,” Pritzker said.

Pritzker announced seven months ago that the state had reached an agreement to sell the Thompson Center to developer the Prime Group for $70 million. The state intended to retain 425,000 square feet of office space at the Thompson Center and contribute $148 million to its renovation.

However, according to the revised plans, Google will take over the entire building, forcing state officials to relocate their offices.

The proceeds from the sale of the Thompson Center will be used to purchase 115 S. LaSalle St., the former headquarters of BMO Harris Bank. According to officials, the new offices will house nearly 1,800 employees who currently work at the Thompson Center and other leased locations. Over 2,000 state employees have already relocated from the Thompson Center to 555 W. Monroe St. and surrounding public buildings. According to officials, the purchase cost $73.3 million.

“This transformative agreement will save our taxpayers nearly a billion dollars over the next 30 years – and further Chicago’s reputation as one of the world’s great tech hubs,” Pritzker said.

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