Another longtime Magnificent Mile stalwart is leaving the building, in a move that could push retail vacancy along the famed shopping street north of 30%.
Banana Republic will close the store it operated at 744 North Michigan Ave. for about 25 years, Crain’s Chicago Business reported, joining the flight of retailers who have abandoned the area since the onset of the pandemic.
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The 39K SF property is now being marketed by JLL, which confirmed the apparel chain had decided not to renew its lease.
Banana Republic’s departure follows those of other big-name retailers like Macy’s, Uniqlo and Gap as the retail strip struggles to stay relevant amid the rise of e-commerce, the pandemic and rising crime rates.
The district welcomes more than 30 million annual visitors to its upscale retail, restaurants and hotels. But it has struggled with high vacancy that hit almost 29% this summer, according to Cushman & Wakefield, a figure that doubles pre-pandemic levels.
JLL Managing Director Peter Caruso told Crain’s the retail exodus gives more impetus to a movement to shake up the mix along the Magnificent Mile. An Urban Land Institute panel last year found consensus the district had grown tired and homogenous.
“Michigan Avenue has turned into nothing more than a regional mall,” Caruso told Crain’s. “There’s nothing exclusive about the brands [that exist there now].”
The street has seen a few signs of life, including new tenants the Museum of Ice Cream, Swarovski and It’Sugar. Caruso said Banana Republic’s landlord has also signed a lease with high-end jewelry store Tiffany and renewed another with Ralph Lauren.
But Banana Republic’s next-door neighbor, Victoria’s Secret, could also be departing, he said, if JLL can find another tenant for the 23K SF space. The chain has three years left on its lease, but is pondering exercising a termination clause.
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