New York real estate investor Ben Ashkenazy is walking away from a Magnificent Mile retail property that has struggled to rebound since the pandemic.
Last year, after his firm Ashkenazy Acquisitions defaulted on a $61 million loan for the property, at 625 North Michigan Avenue, the lender, Barings, considered selling it. Last month, Barings took the keys back via a deed-in-lieu of foreclosure agreement instead.
Ashkenazy has built up a reputation of fighting for his assets, but the Magnificent Mile property may not have been worth the trouble amid the retail corridor’s struggles.
“Many landlords on Michigan Avenue have given back the keys, but we’re bullish on the Chicago suburbs, which is why we recently purchased Gateway Centre,” a spokesman for Ashkenazy Acquisitions said, referring to a retail development in the Rogers Park neighborhood in Chicago near its northern border with Evanston.
Michigan Avenue’s famed retail strip has suffered from soaring vacancy rates and plummeting values since the pandemic. Ashkenazy bought 625 North Michigan just before the outbreak and has struggled to keep existing tenants and attract new ones.
The bulk of retail space at 625 North Michigan, which spans the lower floors of the 27-story building, is nearly empty after big-named tenants Timberland and Coach jumped ship. The last remaining tenant is Garrett Popcorn, occupying 1,500 square feet.
Other notable brands that have left the Mag Mile area include Gap, Banana Republic and Sephora.
Ashkenazy’s loan had an initial maturity date of Jan. 1, 2023, according to Cook County records.
Although it was reported that Barings hired CBRE to market the property last year, the lender declined to comment on whether the property spent much, if any, time on the market after the default.
Some investors are faring better than others along the iconic shopping corridor. Late last year, Landlords Feil Organization and Nakash doubled down on a mixed use property at 645 North Michigan avenue by scoring a $55 refinancing. Around the same time, German watchmaker A. Lange & Sohne leased more than 1,400 square feet in the historic Tribune Tower at 435 North Michigan Avenue, following CIM Group and Golub & Company’s massive overhaul of the building from newspaper offices into luxury condos.
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