Update August. 14th-Mayor Lori Lightfoot confirmed today that Macy’s may have walked out of Water Tower Plaza, but she insisted that the downtown robbery was not the cause.
In response to the Crain story published yesterday, Lightfoot said she understood that Macy’s in February notified Brookfield Property Partners, the operator of Water Tower Plaza, that “they might not renew the lease,” which is located at approximately 170,000 square feet of North Michigan Avenue. shopping center.
Lightfoot said at a press conference: “Macy’s is struggling all over the country,” she announced at a press conference that the police are taking new anti-robbery measures, which indicates that Macy’s is about to leave. There are greater economic reasons behind this.
Lightfoot called it a “false report that Macy’s is leaving” because the Water Tower store has been repeatedly attacked by looters. She said: “(For Macy’s) adapting to this new economy is a challenge. Hard work. ”
Crain quoted sources as saying that the move “has been going on for some time and should not be seen as a response to plunder.” The report also reported that the store’s total revenue has fallen sharply in recent years.
At the same time, Macy’s and Brookfield have not confirmed any news. The source said that the two are negotiating on what will happen now-possibly including whether Macy’s will free up all the space or just shrink the water tower business. scale.
At the same press conference, Rich Gamble, chairman of the Magnificent Mile Association, declined to elaborate on Lightfoot’s speech.
He said: “The mayor covers all the points well.” “I just want to say that most businesses are dealing with the impact of COVID. It’s not just big companies,”
He added that Messi’s departure from the water tower would be a “huge blow”, but Brookfield is actively looking for tenants to fill any available space.
Macy’s has been hit by changing retail trends, COVID-19 and security issues. It has notified its landlord that it wants to free up a lot, and may even withdraw all of its Magnificent Mile in Water Tower Place. Big store, according to people familiar with the matter.
The source told Crane that the decision will allow retailers to focus their attention and energy on its iconic National Avenue store and allow for the redevelopment of the water tower space, which was taken from Bermuda’s shopping mall operator Brook Rented by Field Real Estate Partners.
But losing a compelling tenant with eight floors and 170,000 square feet would not only hurt Brookfield, but also the reputation of North Michigan Avenue as one of the world’s major high-end shopping districts. This will also cause setbacks to Mayor Lori Lightfoot’s efforts to rebuild the city’s economy during difficult times.
In a statement, Macy’s declined to disclose any specific information about the Water Tower Store, but said that “we are continuing to implement our real estate strategy, which focuses on creating value through monetization and, in some cases, redevelopment of assets. ”
But multiple sources confirmed that the two sides have been in intense negotiations. According to reports, Macy’s triggered a one-year opt-out clause earlier this year.
Industry sources said that the performance of the Water Tower store is still relatively good, but even before the COVID and recent robbery attacks, retailers still saw most of their business disappeared, which is typical of brick-and-mortar retailers in the Internet era In fact, the position of revenue from Mag Mile has dropped from US$85 million in 2014 to US$54 million last year.
A source familiar with the situation emphasized that this move has been going on for some time and said it should not be seen as a response to predation. The looting was shot by the South Deputy Police after the murder of George Floyd this spring. In the past few years, other disturbances within Water Tower Place have led the mall management to strictly control parental supervision rules and strengthen safety.
A person familiar with the matter said: “Even before the COVID, many retailers were reimagining their business.” He pointed out that some stores in other cities have been converted into sports or dining facilities or Amazon pickup centers. Old-version retailers “can maintain the status quo or make other portfolio investments.”
However, restaurant operator Lettuce Entertain You Enterprises recently closed its canteen in Water Tower Place without any explanation, which left Brookfield another big vacancy.
Even Macy’s State Street store has become a national landmark. In recent years, it has reduced its business scope and sold the upper floors, which were once the old Marshall Stadium. Field) commercial office and converted it into residential use.
Field was later acquired by a series of owners of Macy’s and was one of the original main tenants of Water Tower Place, which opened in 1975.
Crane was told that Macy’s was dissatisfied with the police’s response to the robbery last weekend. But the store is expected to reopen soon, and the New York-based retailer said in a statement that “it fully supports and cooperates with the City of Chicago while we recover from these sabotage operations.”
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Post time: Sep-01-2020