Najem nabs Fjallraven for Fulton Market lease

Alex Najem is throwing more force — and cash — into his Fulton Market retail push.

The CEO of developer Fulton Street Cos. nabbed outdoor apparel and gear company Fjallraven for a 7,000-square-foot lease on a seven-year term at 1101 West Fulton Street, he and a spokesperson for the tenant said.

The move puts the retailer one storefront away from its competitor, Patagonia, which leased 11,000 square feet at 1115 West Fulton earlier this year — a property also bought earlier this year by North Carolina-based Asana Partners for $21 million.

For Najem, the deal represents his latest success with an attempt to appeal to more apparel retailers in the western edge of Fulton Market, and he plans to build it up with another purchase of more than $7 million for the 10,000-square-foot retail portion of a building just to the west of the new Fjallraven store.

Fulton Street Cos. is under contract to buy the retail at 1133 West Fulton from Domus Special Situations Group. The firm bought the entire building for $9.5 million in 2019 as part of a block-long assembly that also included 1155 West Fulton, which Domus bought three years ago for $10 million.

Fulton Street offers an advantage for merchants compared to Randolph Street, which is known for its concentration of restaurants, according to Najem.

“We think Fulton Street will draw more higher-end retail and is a much better retail street than Randolph,” Najem said. “They all like to be next to each other. So we are hoping more brands start to come over.”

A Fjallraven representative was not immediately available for comment, and Domus didn’t return a request for comment.

Retail rents in Fulton Market have escalated as a slew of apartment towers take shape and continue to get proposed in and around the neighborhood, adding a residential element to the office and lodging projects that propelled the area into one of the nation’s hottest commercial real estate markets.

“Rental rates on Fulton for retail are going to be some of the highest in Chicago soon,” Najem said, adding that they’re set to exceed $80 per square foot per year on some deals.

That take is supported by brokerage data. Fulton Market’s average triple-net rents of $75 per square foot, according to a September Cushman & Wakefield report that looked at 11 retail submarkets. They’re creeping toward the $80 marks achieved on Armitage Avenue in Lincoln Park and the Southport Corridor to the north.

Fulton Market foot traffic also notched a 14-percent increase in foot traffic from its pre-pandemic peak to July 2022, the largest jump out of all the markets Cushman analyzed for its September report.