Commercial
Flexday Launches 25,000 SF of Flex Office at Chicago Loop Tower
By Real Estate Wire Staff, . Real Estate Wire.
Flexday, a national flexible office provider, has activated more than 25,000 square feet of fractional office space inside PNC Centre on One North Franklin in Chicago's Loop, according to Connect CRE. The four suites are sized for teams ranging from 10 to 70 people and are available on on-demand or recurring terms, with no long-term lease required.
The buildout is the product of a partnership between Flexday and MetLife Investment Management, which owns the building. MetLife has been putting capital into PNC Centre more broadly, including a lobby renovation and upgraded tenant amenities. MetLife Investment Management at the property is represented by three JLL professionals: Brad Despot, Senior Managing Director; Kim Doyle, Senior Vice President; and Catherine Walsh, Vice President and General Manager at JLL.
The structure here is worth understanding clearly. Flexday is not a traditional coworking operator signing a master lease and subletting desks. It is offering fractional suites, meaning a company takes a defined, private space rather than a shared floor, but without the commitment of a direct lease with the landlord. MetLife, as owner, is effectively embedding a flex product into its own asset rather than waiting for a conventional tenant to fill the space.
That approach reflects a calculation that has become more common among institutional office owners over the past few years: if the market for long-term leases in a given size range is slow, converting some of that inventory into flexible product can generate occupancy and revenue while keeping the space available for a conventional tenant if one materializes. Whether that calculus is working at PNC Centre specifically, the reporting does not say. No occupancy figures, asking rates or pre-launch demand data are included.
For Chicago Loop office investors and operators watching this, the more telling detail is that MetLife chose to partner with an outside flex operator rather than manage the product in-house. That suggests the ownership group sees specialized flex management as a distinct competency, not something a standard property management team absorbs. It also means Flexday gets a foothold in a Class A Loop address, which strengthens its pitch to corporate tenants who want the address but not the lease.
What remains unknown is the financial structure between Flexday and MetLife, including how revenue is split and what happens to the space if demand for the flex product underperforms. Those terms would tell the market a great deal about how much risk MetLife is actually transferring versus retaining.
Source: https://www.connectcre.com/stories/flexday-opens-flexible-office-space-in-chicagos-loop/
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