Sears Tower Changing Name to “Willis Tower”

March 16, 2009 • Related • Filed Under

Recently, Willis, a very large insurance company based in London took a huge chunk of space in Chicago’s Sears Tower, and with that lease, the name of the tower is changing to “Willis Tower”, changing the name of the most famous building in Chicago and one of the most famous buildings in the US.

A lot of people seem to be appalled by this decision: renaming one of “America’s Landmarks” from a truly American name to a name from a foreign company. You know what I say? Who cares?! If anything, the new name gives the tower more relevance in today’s day and age since Willis is a big, respected and growing company – whereas Sears is well, Sears has lost most (if not all) of the luster it once held when it was the nations largest retailer.

In fact, Sears completely vacated the building in 1995 and originally the naming rights had expired in 2003, since at the time no other major occupant occupied the building and the Sears name wasn’t hurting anyone – if anything, it was helping the now struggling Sears company by keeping the name in front of people – so it was kept.

Willis’, lease was for 140,000 sq ft, which is a little over 4% of the total rentable floor space of the building, at I believe $13.50 psf AND the naming rights were apparently thrown in. Amazing!

This transaction is an example of how desperate building owners have become in this economy – and shows the extent that they are willing to go to sign large, long term leases. Not only did a tenant that occupies less than 5% of the building get to name the building, but they didnt have to pay any extra for it – and while you may think “well, its wrapped up in the lease price” $14.50 psf is a VERY low number for such a high profile building + naming rights.

I looked into the Class A office space thats on the market now in Chicago, and there are plenty of high rise buildings in the $30-45 psf range, although the majority of the asking prices were from the mid to upper teens to high 20′s. Even though, Willis received a pretty good deal.

Now for all those who are upset about a foreign company “taking over” an American icon – just be happy you can pronounce Willis and that its using Roman letters.

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  1. Comment by Jim on March 17 2009:

    Despite being a famous building, the Sears Tower has always struggled with vacancy. The fact that there’s newer, state-of-the-art office buildings (and arguably with better locations) in the Chicago market only made things tougher for The Tower.

    However, I wouldn’t be so quick to dismiss the tower’s renaming as inconsequential. The Midwest marches to the beat of its own drum, and when iconic institutions are rebranded the results are rarely stellar. Case in point: Macy’s acquisition and subsequent renaming of Marshall Fields. Sales suffered dramatically, and when they finally recovered the recession hit. Granted, that’s an apples-to-oranges comparison, but when things are renamed their mindshare tends to reset to 0 with the public.

    The real loser here is going to be Chicago tourism. The Sears Tower is an iconic building, and serves as a major city tourism feature. With this renaming there will be some negative impact to tourism, which means less revenue for Chicago during a time when it needs it the most.

  2. Comment by Andrew Calvo on March 17 2009:

    Thanks for your comments Jim. While I do agree that name changes do have an effect on a brand and its popularity – Marshall Fields is a great example – I don’t see how the changing of the towers name will affect tourism. People are still going to go to the building for what it is – the “tallest building in the western hemisphere” not because of what its called, what color it may be, or who the buildings tenants are.

    In any case, major buildings like this will never completely lose its original name – the MetLife building in New York City is still commonly referred to as the “Pan-Am Building” or even “the former Pan-Am building” after being officially renamed in 1993.

  3. Comment by Doug Easterly on April 22 2009:

    In actuality people will still refer to it as the Sears Tower just as they will call the new skyscraper being built at the World Trade site Freedom Tower even though it is officially to be called One World Trade Center (boo!!)

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