Retail lease terms in Corktown are getting strange

I was grabbing coffee on Michigan Ave last week and overheard two brokers talking about a smaller storefront that just listed at $28 per square foot gross. That number itself is not crazy, but the landlord is asking for a 7 year term with no option to renew and a 4% annual bump. For a startup retail tenant that wants flexibility, that is a tough pill. I have seen a few similar deals lately where owners are locking in shorter terms but with steeper escalators, probably because they expect rents to keep climbing as more residential units come online. It makes me wonder if tenants are actually biting or just walking away. Has anyone else looked at a lease in that corridor recently and noticed the same shift?

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the_claire9d ago

Wait, is 4% annual bump even legal to stack on a non-renewable term? That math gets brutal by year five, and if you have to leave anyway, why sign a deal that punishes you for staying? I would walk unless the base rent was way under market. Honestly, it feels like landlords are betting on tenants being desperate for the location. Your mileage may vary, but that structure only works if you plan to flip and sell the business.