Is the Mag Mile toast?
Almost 1/3rd of the space is vacant. The pandemic looting and Lori's great work in crime prevention helped put the nail in the coffin.
The Mag Mile’s Vacancy Rate is Pushing 29%. Recent Moves Will Push it Even Higher.
ORIGINALLY POSTED BY ALBY GALLUN ON AUGUST 25, 2022 /
Cartier plans to close this longtime store on the Mag Mile, but Swarovski is leasing the space to the right formerly occupied by Rolex.
Three retailers are making moves on North Michigan Avenue in what adds up to a net loss for the beleaguered shopping strip.
First, the good news: Swiss crystal and jewelry maker Swarovski is returning to the Magnificent Mile after closing its two stores there in recent years. The chain is leasing a 1,700-square-foot storefront at 636 N. Michigan Ave., formerly occupied by Rolex, confirmed David Stone, founder and principal of Chicago-based Stone Real Estate, the brokerage responsible for leasing the building.
But the Mag Mile is losing luxury jewelry retailer Cartier, which plans to close its longtime store next door to Swarovski’s future space and decamp for new digs at the corner of Oak and Rush streets, according to people familiar with its plans. And Timberland recently closed its store directly across the street, at 625 N. Michigan Ave.
The deals result in what’s becoming a familiar pattern for North Michigan Avenue: One step forward and two steps back. A few recent leases, including a big one by Aritzia, the Canadian women’s apparel retailer, in the former Gap building have lifted the spirits of landlords and brokers.
But the Mag Mile this year continues to lose more than it wins, with its retail vacancy rate rising to 28.8%, up from 26% last year and 15% in 2019, according to Cushman & Wakefield. The boulevard has yet to stabilize after a wave of store closures during the pandemic.
Recent crime in the neighborhood has only added to the negative narrative, undermining the Mag Mile’s status as one of city’s most popular tourist destinations. The recent moves by Swarovski, Cartier and Timberland will push its vacancy rate even higher.
But Swarovski’s return is a positive sign after the retailer closed stores at Water Tower Place and at 540 N. Michigan Ave.
“I think on this street, even a small deal is meaningful,” Stone said. “It is a significant statement by a significant tenant with stores all over the world that wants to be there.”
Swarovski is bringing a new concept to the space at 636 N. Michigan that’s more of an experience than a store: Wonderlab, an immersive boutique that showcases Swarovski crystals in dreamy, colorful setting. The space has been vacant since former tenant Rolex moved up the street, to 701 N. Michigan Ave.
A Swarovski representative did not have an immediate comment. A representative of the building owner, the Woman’s Athletic Club, referred a reporter to Stone.
Cartier, meanwhile, plans to leave its store in the same building just to the south, totaling about 3,000 square feet, and move into a new space in the former Barney’s department store at 1-15 E. Oak St., according to people familiar with its plans. Cartier, owned by Swiss luxury group Richemont, is following a familiar migratory pattern, joining other high-end retailers, like Chanel and Van Cleef & Arpels, that have left North Michigan Avenue for Oak Street.
Cartier is leasing about 8,000 square feet on the first and second floors of the former Barney’s store. The owner of the 95,000-square-foot building, Bethesda, Md.-based ASB Real Estate Investments, is redeveloping the property for multiple retail and office tenants. Barney’s closed the store in 2019, after filing for bankruptcy protection.
CBRE Senior Vice President Luke Molloy, a member of the brokerage team hired to lease the space, declined to comment on the Cartier lease, saying he was restricted by a confidentiality agreement. CBRE is seeking more retail and office tenants for the building, he said. So far, one office tenant, private-equity firm BlueSpruce Investments, has leased about 7,000 square feet there, Molloy said.
Timberland, meanwhile, closed its store at 625 N. Michigan Ave. around the end of July. The bootmaker had leased the 3,000-square-foot space for nearly a decade.
A representative of Timberland, which is owed by Greensboro, N.C.-based VF, did not respond to a request for comment. An executive at New York-based Ashkenazy Acquisition, which owns the retail space at 625 N. Michigan, did not respond to a email.
This story has been updated to include the correct address for the Swarovski store and the correct owner of the retail space at 625 N. Michigan.