The 7,000 square foot building, adjacent to the Southport Brown Line stop, is a prime spot for foot traffic, as demonstrated every evening by the string of successful restaurants and busy sidewalk patios on either side of the property. Yet Preferred Development, the owners of the property, have made little progress on the site since their announced purchase.
“They bought a string of properties at the peak of the market,” said Heather Way, Executive Director of the Lakeview Chamber of Commerce. “But then the bottom fell out… I have every confidence that they will put it to the best possible use, but it will take time.”
In June of 2008, Preferred purchased three non-adjacent properties on the 3400 N. Southport block for a reported $6.6 million, with plans to demolish the former Red Tomato space, double its floor space to 14,000 feet, and add a 20-car parking garage.
As everyone knows, the real estate market dried up soon after that, and banks tightened the reins on lending. Suddenly vacant storefronts on Southport were not being filled with new stores.
According to Joe Padorr from Preferred Development, plans have not changed for the property: It’s all about the economy.
“Like everything else, bank financing is a slow process. There’s a lot of due diligence to be done,” he said.
Padorr said that despite the lack of financing, Preferred still has businesses that want to move into the space. A call to Southport Fitness, a planned spin-off of Wicker Park Fitness, confirms that the gym still plans to move in as soon as space becomes available.
“We have three letters of intent for the first floor that are being negotiated,” said Padorr. “A national convenience store, a national franchise restaurant—fast casual. The third is a second location of a pizza-oriented sit-down restaurant. This would be their second location. They’re already in the downtown area.”
Way said the economics of Southport Avenue is still very strong compared to the rest of Chicago. “The vacancy rates on Southport until recently have been lower than the city on average. It’s just recently that we’ve lost some stores,” he said.
“The thing that’s different now is that there’s lag time between when people come in [to vacant storefronts].”