Merchandise Mart breaks wholesalers’ leases, prompts showroom exodus

The Merchandise Mart’s well documented transformation into a technology hub and its rebranding to “theMART” left no room for Chicago’s apparel and accessory wholesalers, who say they were forced out early of their 29 independently-owned showrooms on New Year’s Day.

“We’re all still in shock,” said Shilan Fine, owner and wholesale rep for Shilan Accessories.

All of the apparel and accessory tenants at the Mart were asked in September to end their leases six months early and leave the 9th floor by Jan. 1.

Last week, Fine, who sells handbags, jewelry and accessories, moved from an 850-square- foot showroom on the 9th floor of the Mart to a tiny co-working suite on the 12th floor with barely enough room for two desks, much less display racks.

The temporary digs are less than one-fourth the size of the various showrooms Fine has rented since 1993 in the Merchandise Mart and the adjacent Apparel Center at 350 N. Orleans St., now called River Point North.

Hal Waitz, a third-generation wholesale furrier, was given an extension to Jan. 15, so he could finish packing up his showroom. While buying habits have changed, Waitz, 59, said “every industry needs a center.”

“This is the last of the apparel industry in Chicago. There is no longer a central hub,” said Waitz, who is moving his business to northwest suburban Wheeling.

“When you are in business and people ask where your office is, I would be able to say I’m in the Merchandise Mart in downtown Chicago. Now I can’t say that because my business will be located in an office center in the suburbs. It doesn’t have the same cachet.”

The space formerly used by the apparel and accessory tenants will be converted into offices, according to a spokeswoman for theMart, which is owned by New York-based Vornado Realty Trust.

“This was a planned conversion from showroom to office space to accommodate a tenant’s office expansion. We aligned all of the lease expirations for that reason,” the spokeswoman said.

Vornado officials declined to comment on their decision to end the leases early.

When asked if other existing Mart showrooms for furniture and home goods could be converted into office space, theMart spokeswoman said, “There are no current plans to further convert any [more] showrooms to office space.”

Fine contends that the forced departure was prompted by money, so Vornado could rent to one higher paying tenant rather than deal with over two dozen smaller businesses.

“It’s indicating that Chicago is not supportive of this type of industry and Vornado Realty Trust favors corporations over independent small business. It has diluted our presence,” Fine said.

The wholesalers have relocated twice as a group since they moved from the Apparel Center to the Mart in 2012.

But now the Mart is “jam packed” and there is nowhere else in the 3.7 million square foot building for the group to have relocated their showrooms, said Bruce Schedler, vice president of the collective and Stylemax trade show.

Ruth Anne Brown, who enjoyed the largest showroom – a 3,000 square-foot space – in the now disbanded 9th floor, was reached by phone while unpacking in rbc inc. apparel’s new showroom at 650 North Wells Street.

“I’m just happy we found a new home. Everything in the area of the Mart is so expensive. I would love for there to be an apparel and accessory center again. Every regional territory, whether New York, Los Angeles, Dallas and Atlanta, all has one. We are all scattered throughout the Chicago-land area now,” she said.

Schedler’s said at least half of the 29 showrooms on the 9th floor were used mainly for storage, so that the merchandise representatives could more easily haul products from the 9th floor to the 7th floor for Stylemax.

Many of the former tenants disagreed.

Waitz said he was in his showroom “all the time,” while Fine and Margot Nussbaum, another displaced tenant, said they worked out of their showrooms at least three days a week when they weren’t traveling for business.

“It was a great place to do business, Waitz said, fondly speaking about his years at the Mart. It was very convenient taking products in and out with the indoor loading docks and the landlords were great. I had no issues.”

While still Brown said the mass exodus is challenging, it has inspired her to start finding a way to make the Chicago’s wholesale apparel and accessories industry more centralized again.

“We should be able to have a fashion hub. I’ve been doing this my entire life and I plan to pass this business on to my employees, they are like my children. We are not some small group. It’s a hidden industry and it’s sad we are just kind of forgotten,” she said.