More with Dulce Ramos
I have more to share of my interview with Dulce Ramos, owner of The Pump Room Boutique, a shoe store located on Milwaukee Avenue in Logan Square from 2003 to 2007. I lost recording of a part of the interview, so Dulce’s words are interspersed below in my own recap and commentary on some of the things we talked about earlier this month.
In addition to outgrowing the space at the original location of the The Pump Room Boutique at 2727 N. Milwaukee Avenue (see An interview with Dulce Ramos), a pipe had burst in the building, warping and damaging the painted floor that had contributed to the unique feel of the store. The building owner was supposed to pay for repair of the floor, but never did. The floor was never repaired, the painting never restored, the feeling never regained. As bad luck would have it, not even a new location at 2630 N. Milwaukee Avenue cured water problems for the store.
Similarly, G-Mart Comic Books (see New Business of the Year) had leaking water issues at its former location at 2760 N. Milwaukee Avenue as well. I also recall discussion in an April 2008 article, “New Logan Square Store Owners Deal with Development Dilemmas,” about the challenges retail tenants face with Logan Square’s older building stock that have not been kept in good condition (the article, once posted at what is now ChicagoTalks, is no longer available, and I’m working from memory).
There’s another conundrum for Milwaukee Avenue: Without tenants and rents, building owners do not have the money to invest in the proper maintenance and improvements of their buildings that would allow them to be suitable for leasing.
Some of this may be self-imposed. Property owners receive a tax break for the assumed depreciation of their buildings (clearly, plumbing and such does not last forever), but in reality the value of these buildings has not depreciated, but greatly appreciated. If property owners were to spend the amount of the tax depreciation that they receive on paper on actual improvements to their buildings’ plumbing, for example, they would have considerably less water problems and damage and be more attractive to prospective tenants.
Now, there are a number of long-term property owners along Milwaukee Avenue, and maybe they’ve reached their limits in allowable depreciation. The value of their buildings having greatly increased, however, puts them in a position to finance the necessary maintenance and upgrades that would entice prospective tenants to pay the rent that would pay down their loans and part of their taxes.
Sales prices and rents
Long-term property owners are also impeding the revitalization of Milwaukee Avenue in Logan Square with unreasonable sales prices. Some properties have been on the market for years. Just like some homeowners holding out for unrealistic prices in today’s depressed real estate market, Milwaukee Avenue property owners have not come to terms with what price the depressed Milwaukee Avenue market will bear.
Rents seem unreasonable too, given the current state of Milwaukee Avenue. In periodically checking various listings, including the Available
Space listing of the Logan Square Chamber of Commerce, I am surprised to commonly see rents of $25 a square foot. For the same or even lower price, a business could rent space on the well-maintained Sheffield Avenue in Lakeview (photo of sample listing right) or on the popular Chicago Avenue in East Village
(photo of sample listing right).
Peopling Places: What do other business owners need to know to help them be successful on Milwaukee Avenue?
Dulce Ramos: I think in any business — on Milwaukee Avenue or any street — the price of the rent is everything. Our rent at the first place was like $1000 a month. That is ridiculously cheap. The second place was $3500 a month, plus taxes.
What did $1000 include?
It was $900 something, and then with the CAM (Common Area Maintenance) fees, water, insurance and all that fun stuff they charge you when you’re a commercial tenant, it would come up to about $1100 a month total. (Dulce does not recall the square footage of the first space, so I am unable to put that rent in terms of $ per square foot.)
And the $3500, did that include anything?
No, and then we were supposed to pay taxes. ($3500 a month for the 1200 square foot space equates to $35 a square foot.)
Dulce also responded that neither building had a tenant improvement (TI) allowance. A tenant improvement allowance covers some or all of the improvements to a space that are necessary for a tenant to open for business. A shoe store, for example, might need a counter, display shelves, improved lighting, or an electrical outlet relocated. A restaurant might need sinks and ovens, refrigerators and additional bathrooms. To the extent that these improvements are attached and must stay with the property (like the light fixtures in your home), they become the property of the building owner. The building owner is also able to depreciate the improvements for tax purposes so it makes sense that the building owner, not the tenant, pays for this type of improvement.
In this stretch of Milwaukee Avenue between Logan Boulevard and Diversey Avenue, is there a business or storefront that you think has good potential and you could think of ways to redeem it and improve it?
Yea, I think the one that was Fantasy Fashions (photo left)…. That storefront I think is just wonderful frontage, big tall windows…. They need to redo the whole front with newer cleaner looking windows. (They need to redo more than windows; this was the former location of G-Mart Comic Books with the leaking water as mentioned above.)
And then, you know what, compartmentalize it. Turn it into two stores or …just like three shops or something like a co-op effort…. We thought about that with somebody on the space on Milwaukee Avenue…by Wicker Park. My sister and I went there, and it was too large. Then we’re like, “If we could find three other people, we could all pool together,” and you’d have your shoes, your clothes, your accessories. So that store is big enough…. Thoughts like that could go a long way, and that would make it affordable for somebody who wants to be a little funkier, edgier, to start a business…. That would be a really interesting thing if people could do that.
A conversation starter: What is your fantasy re-investment of a business or storefront on this stretch of Milwaukee Avenue?
To be continued.
Scene in Logan Square:
Music, performance and visual art at the Milwaukee Avenue Arts Festival on Saturday, August 9, from 11:00 a.m. to 9:00 p.m. at the corner of Milwaukee/Diversey/ Kimball Avenues to kick off the new season of the newly minted Logan Square Chamber of Arts.
Bonus: simultaneous Milwaukee Avenue sidewalk sale.