CHICAGO — Revelers attending holiday events downtown may notice a novel set of stores and attractions popping up along the Magnificent Mile.
There aren’t enough of these new tenants to fill the many vacant storefronts along North Michigan Avenue. But by offering shoppers fresh options, including handcrafted goods from Mexico, luxury apparel from outlets that were until recently only found online, or a chance to follow Harry Potter to Hogwarts, landlords are trying to remake a street still reeling from COVID-19, competition from e-commerce and the loss of many top retailers.
“We love that our store surprises people,” said Gabriel Neely-Streit of Colores Mexicanos, a gift shop that opened last year on Black Friday at 605 N. Michigan Ave. “Customers ask us all the time, ‘how did we get here?’ ”
Just a few years ago sisters Leti and Erika Espinosa, along with their partner Neely-Streit, were selling at street markets and summer festivals the artisanal goods, including textiles and ceramics, they discovered while traveling in Mexico. Establishing a store in the city’s premier retail district, home to luxury retailers such as Burberry and Louis Vuitton, lets thousands of shoppers experience this aspect of Mexico, something difficult to find in the U.S., according to Erika Espinosa.
“We feel like we’re giving two big contributions to the avenue,” she said. “One, we are showing the real cultural weight of Mexico, and two, we are helping bring in tourists and keep up traffic in the area.”
The sparks of energy provided by new concepts like Colores Mexicanos are just what the Magnificent Mile needs, according to JLL Managing Director Peter Caruso, a broker who represents Michigan Avenue landlords. The long list of stores that exited or will soon exit the street includes Macy’s, Banana Republic, Best Buy and The Gap, all of which sell goods commonly found in average suburban malls, he said. That’s an unworkable strategy on the Magnificent Mile, which needs to attract customers from across the Chicago region.
“There is no more exclusivity to Michigan Avenue, and that was its draw,” he added. “The onus is on retailers to get more creative.”
But it will take years for the Magnificent Mile to recover. E-commerce and changing consumer buying habits battered the street years before COVID-19 pushed its vacancy rate to a historic high. Even today, after the return of many tourists and shoppers, more than 900,000 of the 3.2 million square feet on the Mag Mile is available, nearly double the vacancy rate before the pandemic, according to Cushman & Wakefield.
Other key retail districts have recovered from the COVID-19 downturn, Caruso said. The work-from-home strategy adopted during the pandemic led consumers to buy nearly everything close to home, giving a jolt to suburban retail properties, where tenants have filled long-vacant stores.
“We’ve had stuff that sat vacant for five or six years that is now fully leased,” Caruso said.