A Louis Vuitton store and other retail space at the base of the historic Palmolive Building on Chicago’s Magnificent Mile is back on the market after an attempt to sell it last year fell short.
JLL brokers have been hired to seek a buyer for the 51,795 square feet of retail at 919 N. Michigan Ave., according to a marketing flyer and someone familiar with the property.
The space on lower levels of the 37-story Palmolive Building previously went on the market in April 2022, but owner Nuveen Real Estate was unable to complete a sale.
It is coming back on the market at a challenging time for the mile-long stretch of North Michigan Avenue, long known as Chicago’s top retail destination, but now amid historically high vacancy. It also comes as property sales of all types have slowed throughout the country after more than a year of interest-rate hikes, caution among real estate investors and other economic worries.
Working in the seller’s favor is a strong luxury retail market in Chicago, including on nearby Oak Street, which has landed relocations from the Mag Mile by brands including Cartier, Chanel and Bottega Veneta.
Nuveen also could benefit from a relative scarcity of deals on the Mag Mile, where just 10 retail properties have sold since 2013.
In another deal closely watched by high street retail investors far and wide, local investors Saxony Capital and Farpoint Development have an approximately $40 million deal to buy a fully vacant, multilevel retail structure at 830 N. Michigan Ave. If completed, that deal would bring in the lowest price per square foot on the street since 1997.
How those investors fare in redeveloping the building will be closely watched by investors in top U.S. retail corridors.
It’s unclear how much Chicago-based Nuveen is expecting for the property on the lower four floors of the Palmolive Building at the northern end of the Mag Mile. The company did not immediately respond to a request for comment from CoStar News on Wednesday.
When the retail space went up for sale early last year, Real Estate Alert reported that offers were expected around $150 million. That would be far above the almost $90 million that TIAA, formerly TIAA-CREF and now part of Chicago-based investment firm Nuveen, paid for it in 2012.
It is below separately owned office space and residential condominiums, whose owners over the years have included actor Vince Vaughn and sports figures such as former Chicago Cubs manager Lou Piniella. The residential portion of the tower has a Walton Street address.
The space for sale is 69% leased, according to JLL, with luxury retailers David Yurman and Breitling listed as tenants. Other tenants are residential design studio Tom Stringer Design Partners and a cosmetic dentistry that has been in the building for 25 years, according to JLL.
Real Estate Alert last year reported there was 16,000 square feet of vacancy on the third and fourth floors.
The offering also includes “below market assumable debt, resulting in a generational opportunity to own a bespoke asset,” according to JLL's materials.
JLL doesn’t detail the loan terms. The property was last refinanced with a $55 million loan from MetLife Real Estate lending in June 2018, according to Cook County property records.
The art deco tower, which opened in 1929, is a Chicago landmark. It also is on the National Register of Historic Places. The building was designed by architecture firm Holabird & Root.
Previously, the tower was known as the Playboy Building, when the magazine’s editorial and business offices were there.
For the Record
JLL brokers Keely Polczynski, Michael Nieder, John Dettlaff and Caity Tirakian are representing the seller.