Co-working company Industrious has seen so much demand at a West Loop location it opened this year that it's already doubling its space there. The New York-based company announced it will expand its location at 500 W. Madison St. to 93,000 square feet, up from the 46,500 square feet it leased last year on the building's 10th floor. The new space, slated to open in the second quarter of 2020, raises Industrious' bet on the city's rapidly growing shared-office scene. The company is one of dozens of co-working providers tapping into demand among small businesses and corporate giants alike for flexible workspace that can be rented by the month, day or even hour. The expansion will bring Industrious' local leased total to almost 300,000 square feet across its seven downtown locations and one in Evanston. That makes it one of the most prevalent co-working providers in the city, though it remains far behind industry giant WeWork, which recently inked a deal for a new location in the Fulton Market District that will give it more than 300,000 square feet in that neighborhood alone. WeWork recently surpassed 1 million square feet of offices in Chicago overall, one of only a handful of office tenants with a footprint that large. Buoyed by demand for the low-risk offices, Chicago is projected to have 3.2 million square feet of co-working space by the end of this year and 4.2 million square feet by the end of 2020—almost twice the amount it had at the end of last year, according to data from brokerage Newmark Knight Frank. Most office landlords have embraced some amount of co-working to help occupy space and provide an amenity to other tenants that want to be able to use more office space in a building without having to restructure a lease. But many are also wary of signing away too much space to companies whose primary business is subleasing, because lenders tend to consider it a credit risk. KBS Realty Advisors, the Newport Beach, Calif.-based investor that owns 500 W. Madison, sees the flexibility offered by Industrious and its rivals as "one of the fastest-growing trends in the world of commercial real estate," said KBS Senior Vice President Dan Park in a statement. By expanding Industrious, "we are thrilled to be part of this emerging concept, providing the flexibility and the environment that thriving companies need to grow, adapt and evolve." KBS has been on a leasing roll at 500 W. Madison after a couple of its biggest tenants, maintenance supply company W.W. Grainger and mergers-and-acquisitions adviser Lincoln International, announced they would be leaving the 1.5 million-square-foot building. Its largest new deal was with consulting firm Accenture for 152,000 square feet, which brought the company's total footprint to more than 226,000 square feet and gave the firm naming rights to the building. KBS last year also lured software logistics company FourKites to 500 W. Madison, where it leased almost half of Grainger's former space.
Industrious is increasing its footprint in West Loop, doubling the space it leases at 500 W Madison Street to 93,000 sq ft, due to strong demand for the Chicago location. The additional space will take its tally in the city to almost 300,000 sq ft.