Magnificent Mile Retail Revival Gains Steam as Rents Fall

Chicago’s Magnificent Mile is regaining some of its old shine.

After years of shuttered storefronts, shrinking crowds and pandemic-era malaise, shoppers and retailers are once again filling the city’s most famous retail strip — a tentative sign of life for downtown’s battered retail sector.

Visits to the stretch of North Michigan Avenue are nearly back to pre-2020 levels, crime is trending lower, and a spate of new leases is reversing a multiyear slide in occupancy, the Wall Street Journal reported.

The vacancy rate on the Mile has dipped to about 25 percent, down from 26 percent last year, according to Stone Real Estate. It’s a modest improvement, but a notable one for a corridor still recovering from its worst downturn in decades.

The comeback has been fueled by lower rents and the return of marquee brands.

Canada’s Aritzia opened a 46,000-square-foot flagship late last year, filling a long-vacant box, while Uniqlo — which abruptly exited in 2021 — will soon return with a 29,600-square-foot store. Experiential retail has also joined the mix: the Harry Potter Shop debuted in April, and a magic-themed venue called The Hand & The Eye is slated to open next spring.

“The Avenue is still in recovery mode,” Stone’s John Vance told the outlet. “But it looks better.”

Vance estimates average asking rents along Michigan Avenue are down roughly 24 percent from 2019, helping lure brands back to the strip.

The retail turnaround hasn’t erased all the scars. Empty storefronts still punctuate the six-lane boulevard, and smash-and-grab thefts have kept crime top of mind, even as reported incidents in the 18th Police District have fallen 4 percent year-over-year. The Magnificent Mile Association now funds private security patrols to supplement city police presence.

Meanwhile, the area’s two urban malls — Water Tower Place and the Shops at North Bridge — are question marks after both properties were surrendered to lenders. Pacific Life, which now owns North Bridge, plans renovations next year in a bid to reposition the property.

Compared with peers like Manhattan’s Fifth Avenue and Beverly Hills’ Rodeo Drive, where vacancies are already below pre-pandemic levels, Chicago’s recovery is still lagging. But brokers say momentum is shifting.

“The rents had gotten so high, so frothy,” said Newmark’s Keely Polczynski. “Now, supply and demand are finally starting to meet again.”

— Eric Weilbacher