An iconic Chicago mall is shedding square footage in a bid to stay alive.
The upper floors of Water Tower Place at 835 North Michigan Avenue will be converted into office and medical space, while the first three floors will remain retail, Block Club reported.
The long-rumored pivot was made after years of rising vacancies and anchor tenant departures, including Macy’s, which previously occupied more than 300,000 square feet.
The shift in use, backed by owner MetLife Investment Management, is intended to keep the 1975-built property viable for decades to come, though MetLife has not disclosed a timeline or vacancy figures. A reporter recently counted 18 empty storefronts, with most located on the mall’s top floors.
Alderman Brian Hopkins confirmed the plans, calling the vertical mall model “past its prime” and saying the building had come “perilously close” to becoming a white elephant.
Water Tower’s transformation reflects broader changes sweeping the Magnificent Mile. At the height of the pandemic, the retail corridor hit a 33 percent vacancy rate.
That figure has since improved to 26 percent, according to the Magnificent Mile Association, with recent openings from Warner Bros., Alo Yoga and Aritzia, plus upcoming attractions like a Harry Potter-themed store.
Local officials say the future of the Mag Mile lies in flexibility and reinvention. Several aging malls along the strip are being repositioned into mixed-use or experiential spaces. Nearby Chicago Place, once anchored by Saks, has already been converted to offices and residential units.
Meanwhile, other properties are eyeing retail, dining, medical and entertainment uses to backfill empty floors.
Tourism is also playing a growing role in the corridor’s rebound. Foot traffic along North Michigan Avenue has returned to 91 percent of pre-pandemic levels, and some businesses are outperforming 2019 revenue. The Magnificent Mile Association has shifted its strategy to emphasize cultural and interactive programming from Thursday through Sunday to boost non-office foot traffic.
Still, uncertainty abounds for the corridor. The nearby six-story, 80,000-square-foot building at 830 North Michigan Avenue, for one, is vacant. Owner Fairpoint Development has not confirmed future plans for that former retail hub.
— Judah Duke
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