South Loop may get Apple store
BY SANDRA GUY Business Reporter email@example.com June 14, 2012 1:44PM
The Roosevelt Collection retail space, with rental apartments above, is at 150 W. Roosevelt. | Al Podgorski~Chicago Sun-Times
Updated: July 16, 2012 6:27AM
Chicago may get its third Apple retail store — and the 10th in the metro area — if rumors prove true that an Apple store is under lease negotiations at the long-vacant Roosevelt Collection retail development in the South Loop.
Apples operates nine stores throughout the Chicago area.
Roosevelt Collection developer Dan McCaffery, chairman and CEO of McCaffery Interests, said Thursday that the Apple store’s opening is a rumor.
“I wish they (Apple) were coming to us but they’re not. It’s a non-existing tenant,” McCaffery said. “Apple is not signed by us or even remotely signed by us.”
Apple has been the subject of media stories for years that it would open a store in the Loop or South Loop. The company reportedly pulled out of plans to open in the Block 37 retail development in 2009. The subject took on new life when Crain’s Chicago Business reported Wednesday that Alderman Bob Fioretti confirmed that an Apple store is close to finalizing an opening at Roosevelt Collection. Fioretti did not return repeated telephone calls.
No one at Apple Inc. would confirm any new store openings here.
How many Apple stores can the Chicago market support?
Needham analyst Charlie Wolf said the city of Chicago by itself could support four or five Apple stores “quiet easily,” since the stores quickly outgrow their initial square footage as crowds of shoppers keep growing and new products continue to be hot sellers. The stores are known for their sleek, cavernous and modern layouts, one-on-one sales help, quick mobile checkout, hands-on troubleshooting at the “Genius Bar,” daily classes on evolving ways to use Apple products, and a festival-like atmosphere for new-product launches.
Apple operates six stores in New York City (five in Manhattan), and is already expanding its four-year-old, 15,000-square-foot SoHo store by 5,000 square feet because of the large crowds.
“It’s sort of like, ‘build it and they will come,’ ” Wolf said. “It’s absolutely amazing, no matter how many stores Apple opens, each fills up. ... On occasion, there are crowds waiting to get in to the Fifth Avenue flagship store.” Apple renovated the Fifth Avenue store a year ago at an estimated cost of $6.6 million, and reopened on Nov. 4, 2011, with the unveiling of a giant glass cube on the ground level.
Another Apple store in the former meat packing district of New York at 14th Street and Ninth Avenue completely transformed the formerly downbeat neighborhood into a destination shopping area filled with high-end boutiques, he said.
“The entire complexion of the street totally changed,” Wolf said.
Wolf estimates Apple stores’ visitors have increased at a 15.3 percent annual rate between 2002 and 2011, and that same-store sales, or sales at stores open at least a year, have grown at a compounded annual rate of 17.5 percent in that same period. Apple opened its first store 11 years ago in Tyson’s Corner, Va.
As of late last year, Apple’s average number of stores had jumped 12 percent from the previous year, Wolf said in a report on store growth.
Wolf estimated the average Apple store last year generated quarterly revenues of $17.08 million, net income of $4.13 million and sales per square foot of $5,150, “undoubtedly the highest among retail chains in the world.”
Anne Brouwer, senior partner at Chicago’s McMillan Doolittle retail consultancy, said retailers with a shopper clientele similar to Apple’s covet being next door because they benefit from an Apple store’s traffic and exposure.
“There is no nearby tenant more desirable because of the amount of traffic and sales per square foot,” she said.
Bonnie Sanchez-Carlson, president of the Near South Planning Board civic group, said the South Loop would “benefit tremendously” with store openings at Roosevelt Collection, located just west of the Target store and east of the Whole Foods Market retail development.
“The new owners are working diligently to bring in new retailers, and I believe with their work on the project, it will come to fruition,” she said. “There is definitely a lot more work that needs to be done in that area, but once this takes off, I do think it will help in the future.”
At one time, the Roosevelt Collection was planned to house specialty retailers such as Victoria’s Secret and Banana Republic, a high-end coffee shop and six restaurants.