Why some of Mag Mile is succeeding

Nearly a third of Michigan Avenue remains vacant after the pandemic gutted the renowned shopping destination. But the 900 North Michigan Shops building and adjacent Oak Street are bustling.

Why it matters: The story of Michigan Avenue retail venues and restaurants has been doom and gloom over the last three years, but this longstanding, multiuse development could serve as a model for the future of the Magnificent Mile.

State of play: Michigan Avenue's retail vacancy rate is 33%, according to brokerage firm Cushman & Wakefield.

• Topshop, Uniqlo and Best Buy are among the retailers that have left the shopping strip in recent years.
• Owners of the Signature Room — 900 North's neighbor across the street — cited "severe economic hardship" as a reason for the iconic restaurant's abrupt closing late last month.

The big picture: The retail corridor has historically drawn tourists from around the world. But tourism has struggled to recover to pre-pandemic levels, and a rise in robberies since last year is raising concerns for retailers and shoppers.

• Experts have suggested the Mag Mile's fate relies on its being reimagined as an experiential destination — one where Chicagoans, not just tourists, can play as well as shop. That could mean bringing in rotating exhibits or pop-ups, the latter of which 900 North has been testing out.

Between the lines: One reason 900 North hasn't suffered the same fate as some of its neighbors is that its customer base is 80% local, from neighborhoods like Streeterville, Gold Coast and Old Town, the building's business development manager Alicia Skruba tells Axios.

• 900 North markets itself as a "lifestyle building," which includes residences, a gym, restaurants, retail and a salon. The multilevel shopping center currently has only two storefront vacancies.

What they're saying: Having spaces, like a gym, dedicated to daily and frequent visitors, creates a solid customer base, commercial real estate analyst Rhea Stephen points out.

• Stephen tells Axios successful retailers and developers know their demographic. "Daily, the area is steeped in high-income earners who live and work in this medical and university district," she says.

Details: In addition to residents, Stephen notes that North Michigan Avenue and the Gold Coast benefit from large health care providers in the area, like Northwestern Memorial Hospital.

• "People who are in the medical community, who work there, but then you also have patients that are coming in," Stephen says.

What we're watching: A suburban developer bought 830 N. Michigan — former home of Topshop, Uniqlo and Columbia Sportswear — in August for $40 million, which one broker called "the first post-pandemic investment salvo," according to CoStar. It's been vacant since 2021.

• The clothing brand Aritzia is also slated to move into the former Gap space in the coming months, and H&M will take over Apple's former location at Michigan and Huron.