The operator of the 360 Chicago observation deck near the top of the former John Hancock Center has purchased the building’s 95th and 96th floors, which until September housed the Signature Room restaurant and Signature Lounge.
360 Chicago hasn’t decided how it will use the two floors, which are located directly above its 94th-floor observation deck. A representative said the space will no longer be used as a restaurant.
Operating a restaurant “simply isn’t our business model,” said 360 Chicago Managing Director Nichole Benolken. But the space will remain open to the public.
“We’re not going to put an exclusive private club up there,” Benolken said. “We’re uniquely suited, given our investment into and presence in the building, to create something spectacular.”
The abrupt closure of the Signature Room, one of the city’s iconic tourist attractions, was a blow to the Magnificent Mile, where the retail vacancy rate has soared as a result of online shopping trends and the pandemic. A message posted last September to the restaurant’s social media pages cited COVID-19 and subsequent “severe economic hardship.”
The shopping district’s vacancy rate hit about 30% last year, a historic high, said Magnificent Mile Association CEO Kimberly Bares, but 360 Chicago’s investment shows new uses can be found for empty properties.
“360 Chicago is breaking all kinds of records, so they clearly understand what consumers crave,” she said. “And having this space used by someone who we all agree is a successful and sophisticated operator will spill over to the rest of the Magnificent Mile.”
Magnicity, the French company that owns 360 Chicago, invested about $17 million into the building after buying the 94th floor more than 10 years ago, adding attractions such as Tilt, a moving glass ledge that for two minutes dangles guests more than 1,000 feet above the street, and CloudBar, now the highest bar in Chicago. The company operates similar attractions atop buildings in Rotterdam, Berlin and Paris. It plans to open next year an observation deck, rooftop terrace, garden and bar on the top floors of Warsaw’s Varso Tower, the European Union’s tallest skyscraper.
“We know the challenges of operating at the top of a superstructure,” Benolken said. “We’ll lean into what we’re good at.”
The skyscraper formerly known as the John Hancock Center, located at 875 North Michigan Avenue, has a complex ownership structure, with different investors owning its residences, offices, retail and rooftop broadcast antennas. In 2012, New York-based Madison Capital and Newark, New Jersey-based PGIM, Inc. bought the ground-floor retail and the Signature Room and Signature Lounge spaces for $141 million, and Magnicity paid $18.5 million for the 94th floor, according to county property records. The price paid by Magnicity this week for the 95th and 96th floors was not disclosed.
The Signature Room’s closure remains controversial.
After the previous owners abruptly shuttered the restaurant and lounge in September, a union representing the Signature Room and Signature Lounge employees sued in federal court, alleging staff were fired in violation of the Worker Adjustment and Retraining Notification Act.
The law, known as the WARN Act, requires certain large employers to provide 60 days’ notice of some business closures or mass layoffs. In March, a federal judge issued a default judgment against the Signature Room’s management firm, Infusion Management Group Inc., after it failed to respond to the lawsuit. The company owed former workers $1.5 million in back pay and benefits, the judge ruled, giving the company 30 days to comply with the order.
That deadline has since passed and workers have not received payouts, according to Unite Here Local 1, the union representing the former employees. A representative from Local 1 said the union is pursuing legal action to enforce the order.
Benolken said the Magnificent Mile still faces challenges as it recovers from the retail industry’s shakeup. But tourists and other visitors have returned in big numbers, and several empty spaces along Michigan Avenue have new uses, including the former Crate & Barrel store at 646 N. Michigan Ave., now the five-floor Starbucks Reserve Roastery, where the company showcases its coffees, its history, as well as the roasting process.
“That shows there is room for new experiential retail on the avenue,” she said. “And we’re seeing tourists coming from all areas of the world. Foot traffic is fully recovered.”
The sale to 360 Chicago will definitely provide the Magnificent Mile with another boost, said Anthony Ciaravino, a retail broker and director at Cushman & Wakefield, but the district still needs a full range of restaurants to be a true hub, and his restaurant clients say operating on North Michigan Avenue is costly.
“I don’t see them salivating to get on the Magnificent Mile,” he said.
Ciaravino said downtown’s Riverwalk, where city investment and incentives created a new food and beverage district, could be a model for North Michigan Avenue.
“We have every type of cuisine in Chicago, and that should be showcased on the Magnificent Mile,” he said.
Bares said the district’s vacancy rate should tick down later this year when women’s fashion boutique Aritzia opens for business at 555 N. Michigan Ave., the former home of The Gap.
“It’s a long-term lease for the entire space,” she said.
The Magnificent Mile could soon see other far-reaching changes. In 2021 Bares’ group, along with the Chicago Department of Planning and Development, asked the Urban Land Institute to brainstorm ideas to refresh the blocks between Oak Street and the Chicago River. The institute’s 2022 report envisioned North Michigan Avenue becoming more like the Champs-Élysées in Paris, with a pedestrian bridge linking the street with Oak Street Beach, new pocket plazas and sidewalk cafes, and a grand public common stretching from the historic Water Tower complex to Lake Shore Drive.
“Michigan Avenue has always evolved,” Bares said.
Brian J. Rogal, Talia Soglin , 2024-06-08 00:21:01
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