Construction on a new South Loop mall is expected to start this fall, adding to the retail options off Roosevelt Road.
The five-story, 120,000-square-foot building recently got the go-ahead to start construction, but developer Jaytee is waiting to finalize a handful of key leases before breaking ground, said Jim Schutter, senior managing director at real estate firm Newmark Grubb Knight Frank and the principal agent on the project.
“We’re working on getting a couple retailers over the line,” said Schutter, who said the project has seen interest from tenants in furniture, home improvement, banking and restaurants.
The mall will be on the northeast corner of Jefferson and Taylor streets. In addition to the retail space, there will be three floors of parking, two below ground and one above, and high ceilings will mean the five-story building will be roughly 90 or more feet tall, Schutter said.
“It won’t be overwhelming, but we’re trying to create something unique and exciting for retailers,” he said.
Once construction starts, Schutter said it should take about a year to complete the building.
Although an ongoing court case involving the owner of a 62-acre parcel of land connecting the South Loop and Chinatown could hinder plans to develop the area, other residential projects recently completed or under construction could bring new customers to retailers eyeing the South Loop.
Three new South Loop apartment buildings were expected to be completed between January and August 2016, including the 469-unit 1000 S. Clark St. site that is 60 percent leased, the 307-unit One333 building at 1333 S. Wabash Ave., and the 396-unit 1001 S. State St. building, real estate firm Appraisal Research Counselors said in a report on the downtown Chicago residential real estate market in the second quarter of 2016.
The South Loop also has 67 condos and town homes being marketed for sale, or 9 percent of open units on the downtown market. A 144-unit South Loop building at 1345 S. Wabash that was the first condo high-rise developed downtown after the recession sold out in the second quarter of this year, according to the report.
Retailers’ caution before signing a lease is a sign of a tough retail environment, not skepticism about the South Loop, Schutter said.
“It’s an easy sell to get interest, but it’s a difficult sell to get a deal finalized,” he said. “They’re more thoroughly vetting sites and the economics of deals than they were five or six years ago.”
Roosevelt Road has always been the main retail corridor, but interest is picking up off-Roosevelt too, Schutter said.
“Especially with the Portillo’s (at Canal Street and Taylor) doing phenomenally well, it’s turning Taylor into a great commercial street,” he said.
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