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Rising Rents Blamed for Spate of Empty Wicker Park Storefronts

By Alisa Hauser | November 5, 2015 5:32am
 Milwaukee Avenue in Wicker Park is experiencing an unsually high number of commercial/retail vacancies.
Empty Storefronts in Wicker Park, November 2015
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WICKER PARK — On Tuesday night, the nation's first "boozy" Taco Bell was mostly empty, while earlier the same day, the owner of a dry cleaners lamented the fact his sales are down by 30 percent on a block of Milwaukee Avenue that has 11 vacant storefronts.

"Everything is empty!" said Phil Luparello, owner of Hollywood Cleaners, 1438 N. Milwaukee Ave.

"I've never seen the block this empty at any other time since 1981 when I started here full time. It's supposed to get better, not worse," said Luparello, who owns the shop his father-in-law founded in 1947.

RELATED: Chicago Home Prices, Rents By Neighborhood (MAP)

Luparello, who is a landlord himself and owns the Hollywood Cleaners building as well as a neighboring storefront, said other landlords are being "a little greedy."

"Everything is closing because landlords are raising rent too much. I understand taxes are going up, but don't raise it so much," Luparello said.

Alisa Hauser discusses rising rents and Wicker Park's transition:

This week, the Lomography Embassy Store at 1422 N. Milwaukee Ave. announced it will close at the end of the month, following the recent departures of Bar Bar Black Sheep, 1415 N. Milwaukee Ave.; Continental Furniture, 1425 N. Milwaukee Ave.; Eye Want Eye Wear, 1431 N. Milwaukee Ave.; Citibank, 1455 N. Milwaukee Ave.; Dermatology & Aesthetics, 1455 N. Milwaukee, 2nd Floor; Mondo Meatball,  1467 N. Milwaukee Ave.; The Silver Room, 1442 N. Milwaukee Ave; Max's Wine Dive, 1482 N. Milwaukee Ave.; and Recycle, 1474 N. Milwaukee Ave.

A one-story spot at 1446 N. Milwaukee Ave. has not had a tenant in at least 10 years.

With the exception of Chicago Cupcake, which plans to open in the Bar Black Sheep spot next week, and Volumes Bookcafe, set to replace Recycle, all of the other said storefronts are empty, including the massive Continental Furniture property spanning 1417-19 N. Milwaukee Ave.; 1421 N. Milwaukee Ave.; and 1425 N. Milwaukee Ave.

Greg Dietz, a Baum Realty broker who does a lot of transactions on the block, said he believes some of the larger spots such as Continental will be redeveloped and that "the tenant demand exists to fill those spaces."

"Many leases on Milwaukee Avenue date back to recessionary times of 2007-2009 when rental rates were depressed. The economic recovery and appeal of Wicker Park’s attractive retail scene have pushed retail rents upward," Dietz said.

Meanwhile, Luparello said the rise in vacant storefronts has meant less foot traffic and less business.

After a Citibank branch and a dermatology center closed last spring, Luparello estimated he lost 12 regular customers who worked in that single building.

The former Citibank branch, a 5,630-square-foot spot that includes 14 parking spots, is asking $50 per square foot and a broker is trying to secure a sub-leaser to ride out Citibank's lease, which does not end until Dec. 31, 2018.

Next store to Hollywood Cleaners, Luparello owns a storefront that has been empty for eight months since The Silver Room relocated to Hyde Park.

Personal Privilege, a clothing store at 1420 N. Milwaukee Ave., is planning to relocate into the former Silver Room storefront, which Luparello said is a bargain at $5,000 per month rent for 2,400 square feet.

Ian Feinerman, a commercial real estate agent, said that the range of pricing for rent in the 1400 and 1500 blocks of North Milwaukee Avenue goes from $30 per square foot in the 1400 block and up to $50 in the 1500 block.

"There is a transition going on now. With some big properties becoming vacant, it makes it seem worse than it is, but I would expect them to fill in by spring," Feinerman said.

Feinerman said new businesses are continuing to search out space in the area and chalked up the recent surge in vacancies to market ebb and flow.

"Some business models don't make it, but overall, the neighborhood is still strong and sought after by local and national tenants," Feinerman said

Steve Lipe, a real estate developer and landlord for several Milwaukee Avenue buildings, said that most of the empty storefronts, at least in the 1400 and 1500 blocks, are in transition from one tenant to another. 

"When a space becomes vacant it takes several months to get a lease signed, even if there is a lot of interest. Then there is usually a period of time before the tenant opens when they are waiting for permits from the city and building out their space," Lipe said.

The former Max's Wine Dive at 1482 N. Milwaukee Ave., which closed 7 months ago, is an example of the transition period, Lipe said.

"We identified the new restaurant tenant for the Max’s space in less than two weeks after Max’s closed, but they may not open until late winter, early spring. It just takes a long time," Lipe said.

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