Ashkenazy Gives $72.4M Retail Property on Chicago's Magnificent Mile to Lender

Ben Ashkenazy, a notable New York real estate investor, has decided to walk away from a retail property on Chicago's Magnificent Mile. This decision comes after his firm, Ashkenazy Acquisitions, defaulted on a $61 million loan for the property located at 625 North Michigan Avenue. Although the lender, Barings, initially considered selling the property, they ultimately took possession of it through a deed-in-lieu of foreclosure agreement.

Challenges on the Magnificent Mile

The retail corridor on Michigan Avenue has faced significant challenges since the onset of the pandemic, including rising vacancy rates and declining property values. Ashkenazy acquired the 625 North Michigan property just before the pandemic began, and has since struggled to retain tenants and attract new ones. Major brands like Timberland and Coach have vacated the premises, leaving only Garrett Popcorn as the sole tenant in the largely empty retail space.

Ashkenazy’s Broader Real Estate Strategy

Despite the difficulties with the Magnificent Mile property, Ashkenazy Acquisitions remains optimistic about other areas of Chicago. The firm recently invested in Gateway Centre, a retail development in the Rogers Park neighborhood near Evanston, indicating a strategic shift towards more stable markets.

Varied Fortunes for Michigan Avenue Investors

While Ashkenazy has opted to exit his Magnificent Mile investment, other investors have experienced more success along this iconic shopping street. Last year, the Feil Organization and Nakash secured a $55 million refinancing for a mixed-use property at 645 North Michigan Avenue. Additionally, luxury watchmaker A. Lange & Söhne leased space in the Tribune Tower, which has been transformed from newspaper offices into luxury condos by CIM Group and Golub & Company.