Vacant Site Eyed for Life After Borders

Location almost always works in real estate.

Even in a difficult economy that cost a beloved tenant on the property, the southeast corner of Lake Cook and Waukegan roads is deemed too good to pass up by prospective businesses.

A 24,500-square-foot building on the site had housed a Borders until this spring, in the first of two rounds of closings as the company ended its 40-year-run.

Now the site management and interested local parties welcome the prospect of dividing the space into at least three parts for new tenants of the property at 49 S Waukegan Rd. in Deerfield, on the border with Northbrook.

“This building will not sit for long,” said Rob Rowe, a leasing agent with the Sierra Group Inc., which is handling other vacant Borders properties nationwide. “There’s a lot of interest from a lot of users.”

Rowe said the entire building could be fully occupied by the end of 2012, but that doing so would require getting timely cooperation from village officials on permits and other matters.

For one thing, if multiple retailers move in, the property will need an upgrade to provide separate entrances. A casual-dining restaurant, a good prospect for the main floor, would need a special-use permit, and that would require public hearings. At least one service business is foreseen for the second floor.

“It will be different tenants that will take advantage of the good location,” Rowe said. “Hopefully the village will cooperate in all the things we need to do to make it successful for these tenants.”

Changing tenant landscape

Multiple tenants for such properties are crucial because the market is limited for retailers interested in operating an entire two-story building, according to Kathy LeVeque, associate planner for Deerfield.

Rowe explained that his firm would try to lease the building from the top floor down.

“Ground floors are relatively easy to lease,” said Rowe. “We’ll have the second-floor leased before we lock down the first-floor tenant. We’ll end up with a tenant on the second floor and a couple on the ground."

“It’s a great-looking building," he noted. "Borders did a great job maintaining the property and living up to its obligations.”

No matter who occupies the building, it won’t soon lose its identity as a Borders store.

“A lot of people in town were disappointed to see it go,” said LeVeque.

"It’s wonderful for people to pass by the intersection with a business open [rather] than to see the storefront staying empty,” she added.

Unwanted shadow

A long-vacant Borders building could cast a negative light on neighboring businesses in Deerfield and Northbrook, where village limits cut just south of the property.

“Whenever there’s a vacancy, it casts a shadow on the whole area,” said Tom Poupard, director of development and planning services for Northbrook.

However, he noted, vacant storefronts are much more prominent in more western suburbs.

“It shows the strength of the North Shore real estate in commercial development,” he said.

While touting the property’s prime location at one of the area’s busiest intersections, Poupard noted only one drawback to the Borders site.

“The problem has been access from the street,” he said.  “Great location, great visibility, terrible access.”

Drivers can only enter the lot going eastbound on Lake Cook or northbound on Waukegan.

Despite the inconvenience, the bookstore was one of the bankrupt chain’s best performers. Although many of its store leases were not favorable, Borders' locations, including in Deerfield, were the least of the problems. According to media reports, Borders was a victim of internal mismanagement and changing consumer tastes that favored online sales and e-book reading tablets such as Kindle.

Exposing a new reality

Subdividing large, vacant retail properties or even subleasing existing space while the main tenant stays put is a reality of today’s tough business climate, said Northbrook's Poupard.

“One retailer I heard that has more floor area than they need is Best Buy,” he said. “Sales are good, but they don’t need more floor space. They’d like to sublet space within the store to other businesses.”

“Borders had come to us early on when they were having some issues,” said Rowe, whose company manages the properties. “They let us know this was a very good store for them, but at the end of the day it was going to end up closing with a lot of them.

“You look all over Chicago, and Borders had some of the best real estate around. Michigan Avenue, State Street, there were wonderful corners all over. I could go on and on.”

Brick-and-mortar book fans don’t have to go too far, as several options remain. There is a store on Waukegan Road, just a few minutes' drive north of downtown Deerfield, and a located just east of that on Skokie Valley Road in Highland Park. Independent offerings include in downtown Northbrook and in Winnetka.