H&M downsizes in Mag Mile move

Apparel retailer H&M is moving into the long-vacant former Apple Store on Chicago’s Magnificent Mile, though the move isn’t exactly an indicator of the shopping strip’s resurgence. 

The Swedish chain led by Helena Helmersson has agreed to a four-year lease, occupying 30,000 square feet of the four-story building at 679 North Michigan Avenue, reported Crain’s. It’s one of the largest leases on the famed shopping strip in recent years, even as it amounts to a substantial downsize for H&M and a net increase of vacancy.

The retailer was occupying about 60,000 square feet at 840 North Michigan Avenue, meaning its departure leaves another big void on the strip, as only 27,000 square feet of the 87,000-square-foot building is being leased by another tenant, Verizon. The relocation spiked the Mag Mile’s vacancy rate to 29 percent.

Yet there’s a consolation prize for landlords: H&M is at least staying on the Mag Mile. Brands including Gap, Banana Republic and Uniqlo have left the area. The move also makes sense given the increase in online shopping. Retailers don’t need as large of spaces to hold their inventory, and H&M will pay less in taxes, rent and other expenses.

“It consolidates more energy on a better block,” CBRE’s Luke Molloy, who wasn’t involved in the deal, told the outlet. “Any recommitment to Michigan Avenue is a positive.”

Matt Ramsey of Jones Lang LaSalle brokered the deal and represented H&M in the lease. It’s a win for Water Tower Realty Management, the owner of the old Apple Store building.

H&M initially pursued the building at 555 North Michigan, but that space was swooped up last year by Canadian women’s apparel chain Aritzia in a 46,000-square-foot lease, which marked the largest on the Mag Mile since 2015 and brought some hope to the struggling boulevard.

— Quinn Donoghue