Block 37 has signed a lease with AMC Theaters to bring an 11-screen dine-in movie theater to the State Street mall, a key development that should help draw shoppers to the mall's long-vacant upper floors and further the Loop's image as a night and weekend destination.
The new theater, scheduled to open by early 2016, will occupy 44,000 square feet on the top floor of the enclosed mall, AMC and the mall's owner, Los Angeles-based CIM Group, announced Monday.
The movie theater will feature AMC's signature MacGuffin's Bar and Lounge in the theater lobby and will be the first in the city to offer AMC's "Cinema Suites" experience. Cinema Suites, for people 18 and older, features power recliners with individual tables for theater dining and cocktails for those of age, delivered by servers summoned with the push of a button.
The lease fills a crucial gap on the mall's upper floors that until recently have struggled to land tenants and concludes years of efforts to bring a movie theater to the mall, which has five levels, including the lower-level pedway. A 22,000-square-foot Latin-themed food court called Latinicity, from Denver-based Richard Sandoval Restaurants, is scheduled to open on the third floor this spring.
"This is an important piece of the puzzle," said John Vance, a vice president at Stone Real Estate, which was not involved in the deal. "You have these necessary components on the upper floors of the mall to drive people upstairs and into the center of the mall."
The deal also reflects that companies outside of Chicago are increasingly seeing the Loop not just as place to work, but also to dine, shop and be entertained, Vance said.
"This section of the Loop is a 24-7 market," he said. "It's been happening for five to seven years, but now it's, 'Wow, you've got to take a look at the Loop.'"
Though there are downtown movie theaters north of the river and in the South Loop, where the Showplace ICON Theatre at the Roosevelt Collection outdoor shopping mall also features an adults-only dine-in movie experience, the Loop hasn't had a commercial movie theater since the 1980s, Vance said.
Muvico Entertainment was set to bring a luxury movie house to the Block 37 in time for its opening five years ago but was among several early tenants that pulled out of their agreements due to financial troubles with its developer Joseph Freed and Associates. The property fell into foreclosure a month before its scheduled opening and was sold in auction to Bank of America for $100 million in 2011. CIM Group purchased it in 2012.
Not including the signed tenants who have yet to move in, Block 37's vacancy rate remains at about 63 percent, according to real estate data provider CoStar Group. Even after the new entrants the mall will still has a lot of storefronts to fill, including almost 30,000 square feet on the fourth floor and almost 40,000 square feet on the second floor, according to a leasing brochure.
Existing tenants welcomed the movie theater's announcement.
"It is going to make a big difference, just like the food court," said Anne-Laure Schellenberg, manager at L'Occitane en Provence, which is on the first floor of the mall. Flanked by several vacant storefronts, Schellenberg said business has been tough because "there is no foot traffic." Shoppers who patronize the stores that face State Street often don't realize that there is a mall inside, she said.
"We're all super excited," said Astrid Aguilar, receptionist at Ladies and Gentleman Aveda Salon and Spa, which for years was the sole tenant on the third floor. "We will definitely have more traffic."
Despite being in a lonely corner, the salon hasn't suffered, she said. Stylists have a steady clientele that keep them fully booked. Still, she said, "it is always good to be more in demand."
State Street in general has been enjoying high demand, real estate watchers say. The shopping strip's premier ground-floor retail space between Lake and Monroe is fetching rents in excess of $200 per square foot, about 25 percent higher than the rest of the central business district, Adam Cody, vice president of the Retail Group at Chicago-based retail brokerage JLL, wrote in an email. Larger retail spaces that become available backfill quickly, which is "a testament to the corridor's strength," he said.
"State Street is one of the few trade areas in Chicago metro area where junior anchor apparel retailers have targeted and opened new stores in the past two years, and the select apparel retailers located on State Street have achieved sales (of) $1000-plus per square foot," Cody wrote. "It's a thriving and dynamic retail destination."
Talks to bring AMC to Block 37 began at least two years ago when Stone Real Estate was still the broker for the mall, Vance said.
Anthony Campagni, managing director at RKF retail brokerage, which currently conducts leasing for Block 37, declined to comment.
The deal comes as Block 37, located on State Street between Randolph and Washington streets, moves forward on several other projects. Last month it announced it had secured the initial permits to build a 34-story, 690-unit apartment tower with a rooftop pool on the northern part of the block. Construction barricades are up and site preparation is underway, though no opening date has been set.
Block 37 is also set to add a new 5,000-square-foot restaurant and bar concept from the Lawless family, which operates The Gage and Acanto (formerly Henri) on Michigan Avenue, to the ground floor at Randolph and Dearborn streets.
Gabby Leyhane, who works as a legal assistant downtown and was sitting on a bench outside of Anthropologie during her lunch break studying a textbook for night school, said the movie theater might give her a reason to stick around after work.
"On Fridays I usually just go home," said Leyhane, 29, who lives in Lincoln Park. "If there's something going on I might stay and do something."
Leyhane said the energy of the mall has always been subdued, which has made it a good place to study and read. If the mall fulfills its long-anticipated promise to become a bustling shopping destination, as its owners and tenants hope, "I may have to find some other spot," she said.
aelejalderuiz@tribune.com
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