Under Armour will open its newest specialty retail location at 600 North Michigan Avenue in March 2015. Although Apple’s 22,000 square foot flagship store is located on the Magnificent Mile, Under Armour’s new 30,000 square foot Brand House retail store outshines it by 8,000 square feet, and will open in the heart of the city’s thriving Magnificent Mile as well, on the corners of Michigan Avenue and Ohio Street.
The store will focus on cutting-edge products and design, while serving as a stunning example of Under Armour’s commitment to offering customers a superior shopping experience.
“From my perspective,” Kirsch said. “Most national retailers like Under Armour need a brand house, a place where all of their products are showcased in a way that they intend them to be showcased. So the brand house to me seems to be the way that Under Armour can get across the full spectrum of what they are as a company.”
Kirsch couldn’t be happier with the Brand House opening on the Magnificent Mile, calling the transaction the deal of his life.
“I’ve been practicing commercial real estate for the last 17 years in Chicago,” he said. “During that time I’ve never had the opportunity to work on a transaction that was more exciting and impactful, not only to the community, but is also what‘s probably our premiere retail store. So to do the Under Armour deal is just tremendous. I’m just so grateful and it’s an amazing transaction that has worked out.”
The Chicago Brand House will feature men’s, women’s and youth apparel, footwear and equipment, and will be staffed with product category experts to ensure that all customers receive guidance and recommendations that are tailored to their unique needs, with the end-goal of outfitting them in the perfect head-to-toe looks.
Kirsch said that Under Armour is opening flagship stores across the United States, but the biggest one by far will be in Chicago.
The Brand House retail store on the Magnificent Mile will feature nearly 30,000 square feet of interactive retail space and will deliver a fully immersive brand experience. The Brand House will tell the Under Armour story through innovative digital displays that act as points of information, as well as inspiration.
“I don’t know their specific design just yet because they’re still working on it,” Kirsh said. “This space is nearly twice as big as the New York store. But from what I’ve seen in the Baltimore location, the philosophy behind brand houses is to bring customers to a more complete understanding about how all of the Under Armour products fit together.”
Under Armour’s retail concept has been successfully executed in other premium locations, including Tysons Corner in McLean, Virginia, New York City’s SoHo neighborhood, and the brand’s hometown in Baltimore, Maryland.
The search for Chicago’s new Brand House took over two years, and it is now the largest transaction on the Magnificent Mile to happen in the last five years.
“Thirty thousand square feet is the biggest one,” Kirsch said. “I think when you look at a sub market that’s three million square feet, the Magnificent Mile, and when you look at a tenant that single handedly lowered the vacancy rate by a full point in what is typically a pretty tight market, I think that’s a very relevant statistic.”
“We’ve been really active on the avenue lately. The brand house transaction is just one, but we’ve been counting up the deals we’ve done in the last three quarters, and we’ve done about 70,000 square feet over five transactions, which brought the vacancy down from 7.42 percent to 5.0 percent in a real short period of time.”
Kirsch added that the Under Armour brand house deal represents the biggest chunk of their transactions, but another transaction, a bit bigger than that, is the Walgreens transaction at the Wrigley Building where they represented the landlord.
What Newmark has also seen on Michigan Avenue, Kirsch says, is an increase on base rents in small shop space of over 30 percent in the last six quarters.
“As well as a decrease in vacancy in general, landlord’s expectations today have shifted to maximizing value across the board. So even though we sometimes see vacancies, they are very strategic because landlords are looking long term. That is always a more lucrative solution.”
Kirsch added, “That’s our job at Newmark to find these landlords better tenants, whether it’s the Wrigley Building or the John Hancock building that we represent, or tenants like Under Armour or Vineyard Vines, where we work for them.”
Under Armour’s new Brand House on the Magnificent Mile further solidifies the brand’s connection to the Chicagoland area, as they have recently signed a license agreement with Northwestern University and with Major League Baseball.
“The idea is that the Midwest in general has been really good to Under Armour”, Kirsch said. “One of the great things about the company that excited me about working with them was their commitment to the community. Under Armour not only embraces the universities, but works with local and national charities as well.”
“If you go to their brand house in Baltimore for example, you’ll see a ton of interactive activity with local sports teams. I’d expect them to do the same thing here in Chicago.”