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Chicago

Mag Mile to get largest retail lease since 2015

Apparel chain Aritzia moving into former Gap building

555 North Michigan Ave and Aritzia's Jennifer Wong (CBRE, Aritzia)
555 North Michigan Ave and Aritzia's Jennifer Wong (CBRE, Aritzia)

The Magnificent Mile is getting its largest retail lease since 2015, a sign that Chicago’s retail market may be picking up.

Aritzia, a Canadian women’s clothing chain, is moving into the former Gap building at 555 N. Michigan Ave, Crain’s reported. CBRE brokered the lease for the 46,000 square foot space.

The city’s shopping district has lost one tenant after another amid the pandemic and a rise in violent crime, including Gap, Macy’s and Uniqlo, leaving about a quarter of the retail space on the stretch of North Michigan Avenue vacant.

“Coming out of the pandemic, this is an important deal for the Mag Mile, and Chicago in general,” Luke Molloy, CBRE senior vice president and leader of the team that arranged the lease, said in a statement to Crain’s.

The city’s retail market is making strides toward recovery, with 70 percent more retail property trades in the Chicago area in the year ending in March than in the prior 12 months, The Real Deal reported earlier this month. While overall leasing is up, the Mag Mile, along with the Loop and River North are lagging behind the suburbs.

Aritzia also operates stores in Rush Street in the Gold Coast and in the suburbs of Skokie and Oak Brook.

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Karen Janes, Aritzia’s senior vice president of real estate and new business development, told Crain’s that the roughly 8,000 square foot Rush Street store has been “incredibly successful,” which was one reason the company felt optimistic about expanding onto the Mag Mile.

“We do believe that North Michigan Avenue is going to come back,” Janes said, adding that the company’s expansion “could be a catalyst” for other retailers to come.

Gap shuttered its 555 North Michigan Avenue store in January 2021, along with two other Chicago locations, citing pandemic-related difficulties.

The building’s owner is Irish investment firm ECA Capital, which also owns the adjacent storefront. The firm came close to defaulting on a $55.5 million mortgage a little over a year after Gap left.

[Crain’s] – Rachel Herzog

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CoronavirusMagnificent Mile