Tesla’s decision opens up a second storefront at the corner of Rush and Delaware streets, after Intermix, a multi-brand women’s fashion retailer, closed its store across the street earlier this spring. But the Gold Coast shopping district has flourished since the pandemic, so finding tenants for the two spaces shouldn’t be as hard as it is on North Michigan Avenue to the east, which continues to struggle.
“The Gold Coast market is exceptionally strong right now, bordering on frothy,” said John Vance, principal at Stone Real Estate, a Chicago retail brokerage.
It’s unclear why Tesla is marketing its Rush Street showroom for sublease. The decision may be part of a broader shift in its marketing strategy. In 2021, the Austin, Texas-based manufacturer decided to close showrooms in shopping malls and focus on less-expensive locations.
Tesla did not respond to a request for comment, nor did brokers for ARC.
Tesla opened the Gold Coast showroom in November 2017. The space is part of the 900 North Michigan Shops mall. Tesla occupies the space under a lease that expires in March 2027, with options to extend it for two more five-year terms.
If Tesla were to close the Gold Coast location, it would have only one showroom left in Chicago, at 1053 W. Grand Ave. in the River West neighborhood. The company also has stores in Highland Park, Schaumburg, Libertyville, Westmont, Naperville and Orland Park, according to its website.
Intermix, meanwhile, ran into financial trouble earlier this year after Regent, a Beverly Hills, Calif.-based private-equity firm, acquired the chain last fall. Intermix closed at least 17 stores earlier this spring, including the one in the Gold Coast, at 900 N. Rush St.
Fred Latsko, the retailer’s landlord, is marketing the 4,200-square-foot space to other retailers. He also has filed an eviction complaint demanding that Intermix pay about $375,000 in back rent.
“They’ve already terminated the lease, but they’re just not cooperating,” said Latsko, owner and CEO of Chicago-based Latsko Interests.
A Regent representative did not immediately respond to a request for comment.
Latsko has hired broker Anthony Campagni, principal at Canvas, to lease the storefront at 900 N. Rush. Given the strength of the Gold Coast retail market, Latsko is confident he’ll be able to find a new tenant soon to take over the Intermix space.
“We have a couple looking at it right now,” he said.