RETAILREVIEW A PUBLICATION OF MID-AMERICA® REAL ESTATE GROUP Mid-America FALL 2014 Assists Ross Stores, Inc. with Chicagoland Expansion Ross on Randolph Street to Open October 7 Mike Phillips, Dan Tausk, opment Group have partnered to of the best retail corridors in the area. ICSC Chicago and Andy Bulson secure locations and open stores Ross Stores, Inc. was able to recycle from downtown Chicago (Randolph that space resulting in new high pro- Deal Making Street – opening October 2014) to file Ross Dress for Less stores. Chi- Since their market entry in Octo- October 7 - 8, 2014 ber 2011, the Chicago offices of Crystal Lake, IL and from Gurnee, IL cago-area deals have been finalized Mid-America Real Estate Corpora- to Merrillville, IN. Mid-America’s bro- with local owners, regional REITS Navy Pier tion have assisted Ross Stores, Inc. kerage team consists of Senior Vice and the largest national landlords. 600 East Grand Avenue in successfully securing forty (40) President Mike Phillips, Principal/Di- Chicago, IL 60611 Chicago-area Ross Dress for Less rector Suburban Tenant Brokerage “The level of collaboration beginning locations. Andy Bulson and Principal/Director with the Market Research Group to Stop by and visit us at the Urban Tenant Brokerage Dan Tausk. our dealmaker to legal and then de- ChainLinks and Mid-America Real Estate Group Booth #711 Ross Stores, Inc. is an S&P 500, sign and construction is as strong as Fortune 500 and Nasdaq 100 The foundation for Ross Stores Inc.’s any tenant we have had the opportu- (ROST) company headquartered in expansion program is their Market nity to represent,” said Bulson. Illinois Office: Dublin, California, with fiscal 2013 Research Group, one of the most One Parkview Plaza, 9th Floor revenues of $10.2 billion. The com- sophisticated in the retail industry. As we enter the 4th Quarter 2014, Oakbrook Terrace, Illinois 60181 pany operates Ross Dress for Less® The Mid-America team has worked Ross Dress for Less is scheduled 630.954.7300 closely with the Market Research to open three (3) additional Chica- (“Ross”), the largest off-price apparel Chicago Office: go-area stores in early October and and home fashion chain in the Unit- Group to establish and implement 435 N. Michigan Avenue, Ste 2009 ed States with 1,146 locations in 33 the expansion program. continue their expansion for the fore- Chicago, Illinois 60611 states, the District of Columbia and seeable future. 630.954.7327 Guam at fiscal 2013 year end. Ross “Ross Stores, Inc. has been a plea- “Despite the level of penetration and Wisconsin Office: offers first-quality, in-season, name sure to represent. Their entire team is success achieved to date, there’s 648 N. Plankinton Avenue, Ste 264 brand and designer apparel, acces- focused, well-organized and appre- still a long way to go to achieve our Milwaukee, Wisconsin 53203 sories, footwear and home fashions ciative of our efforts,” said Phillips. 414.273.4600 goals,” said Tausk. “Many city mar- for the entire family at everyday sav- “Ross has changed the Chicago re- kets remain underserved, and Ross Minnesota Office: ings of 20% to 60% off department tail landscape dramatically by quickly will open a potential flagship store 5353 Wayzata Boulevard, Ste 650 and specialty store regular prices. absorbing a good chunk of post-re- on Randolph (downtown off State Minneapolis, Minnesota 55416 The company also operates 130 cession vacant junior anchor space.” 952.563.6600 Street) on October 7. This will be dd’s DISCOUNTS® in ten states. As Ross Stores, Inc. entered the Chicago market, many well-known their sixth urban store, which is just Michigan Office: retailers such as Borders, Circuit City a start.” 38500 Woodward Avenue, Ste 100 After three years of aggressively Bloomfield Hills, Michigan 48304 and Linens ‘n Things had vacated or attacking the market, Mid-Ameri- 248.855.6800 ca and the Ross Property Devel- were in the process of vacating ex- tremely desirable locations in some www.midamericagrp.com Mid-America Real Estate Corp. | Tenant Rep. Expanding Tenants Tenant Representation New Faces Typical size: 21,360 SF Kevin Reinke, Kevin McLoughlin Associate Typical size: Typical size: Typical size: 25,000 SF 3,500 SF 25,000 - 40,000 SF Mike Phillips, Dan Steve Frishman, Jeff Kuchman, Tausk, Andy Bulson Brian Adams Stanley Nitzberg Typical size: 1,200 - 5,000 SF Brian Adams Katie Killeen, Associate Typical size: Typical size: Typical size: 40,000 SF 7,500 - 8,500 SF 49,500 SF Typical size: Jeff Kuchman, Kevin McLoughlin Brian Adams, 3,500 SF Willie Hoag Steve Frishman Peter Scannell The Tenant is King - A Chain Store Age Profile with Jeff Kuchman Katherine Boccaccio, Chain Store Age Senior Editor In a time of evolution and change, when buzz terms like right-sizing and customers. We view relationships over a long period, and always attempt to asset management dominate retail real estate conversations, an unwavering counsel with that in mind. focus on the tenant is more important than ever before. Chain Store Age talked with Jeff Kuchman, Principal/Director Tenant Brokerage, Mid-America What are the biggest challenges facing retailers today with regard to Real Estate Corp., based in Oakbrook Terrace, Illinois, about the company’s their real estate activities? tenant representation business and how it has continued to take center stage. Securing the best possible locations at affordable costs of occupancy remains our clients’ biggest challenge, especially in light of the lack of new How much of a focus is tenant representation for Mid-America development activity over the past seven plus years. In Chicago alone, we Group, and how has that part of the business changed over the last averaged 5.5 million sq. ft. of new shopping center development over a few years? 25-year period ending in 2007. We’ve averaged less than one million sq. ft. per year in the period since. The absorption of vacant space and the With the exception of lending/financing, Mid-America is involved in virtually dearth of new developments have driven rents and acquisition costs steadily every aspect of the retail real estate business. However, tenant represen- higher, so identifying and securing the right piece of real estate that fulfills our tation is as much a part of our core mission as it was 30 years ago. Our clients’ mission is even more critical than ever before. Construction costs are five offices operating in the upper Midwest represent some 250 national, another factor adversely affecting our clients’ occupancy costs. Acquiring regional, and local chain stores in nearly every retail category. Evolution greater market share is expensive, and doing so while balancing investor and and change are critical to our retailer clients, and it’s critical that we evolve shareholder interests is an art. alongside them, being ever mindful that we remain, at the most basic level, information providers. Providing our clients with timely and accurate infor- What about their greatest opportunities? mation that allows them to evaluate and respond to real estate opportunities remains the most important aspect of what we do … and we do that through The greatest successes are derived from overcoming the greatest challeng- media and ways that we’d never have dreamed possible before. Whereas es. By establishing a clear vision for growth/market share, and working with 30 years ago that information was almost expressly used for purposes of the right team of seasoned real estate professionals, our clients are apprised securing new store locations, today we’re involved in all phases of our retailer of opportunities in advance of their competitors and secure the most prof- clients’ real estate needs. itable locations from which to service their customers. Our goal is to make every invested real estate dollar count for our clients. What kinds of services/advantages do you provide to tenants that fosters their loyalty to your firm? Overall, how would you describe the state of the industry right now, and what are Mid-America’s strategies for tenant success? As I mentioned, strategy creation, new store deployment, acquisition eval- uation, lease renewals, dispositions, down/rightsizing, asset and facilities Retailing is a tough, competitive business – one that constantly evolves. The management, vendor agreements -- we become so deeply woven into our internal real estate departments today are accomplishing more with less in clients’ real estate departments that we’re viewed as an integral part of the terms of internal personnel and support than ever before. So much of what team from day one. That depth of coverage only happens when we take we do consists of activities that one or several internal real estate profession- the time to truly understand what makes each client successful, and how als did years ago. When our clients are spread thin, it’s our job to make their real estate serves the greater purpose of allowing each to better service their time with us as efficient as possible. Mid-America Real Estate Corp. | Urban Team Broker Profile What are some of the current moving towards smaller formats to to a “big-house”, I knew it was going projects you’re working on? keep their occupancy costs down, but to come with a lot of change. The Michael Wexler, I’m working on a range of projects there’s opportunity in that as well. Ris- corporate culture was somewhat of a Vice President representing both landlords and retail- ing rental rates have proven the market shock at first and for a while I didn’t ers throughout the neighborhoods of is healthy and Chicago’s retail future know if I fit in. But after getting to Chicago.