MetLife Investment Management plans a $170 million redesign of Water Tower Place’s lower floors, shifting space for retailers and adding an atrium as construction begins in 2027.
Water Tower Place, one of Chicago’s most recognizable shopping destinations, is getting a major makeover—this time with MetLife putting a substantial bet on its long-term retail pull.
MetLife Investment Management announced it will invest an estimated $170 million to redevelop the mall’s lower floors as Water Tower Place marks its 50th anniversary this month.. The plan would consolidate the first three floors for retailers. opening the layout and adding an atrium designed to make foot traffic feel less like a walk-through corridor and more like a destination in itself.. Floors four through eight would then be repurposed for other tenants. including office and medical uses—an approach that signals the building’s owners want to diversify demand beyond traditional mall traffic.
The timing is also structured to reduce disruption for current businesses.. Construction is set to begin in 2027 and finish in 2028. with the work being carried out in phases so existing tenants can remain open.. That matters in a retail climate where closures are often contagious: when shoppers perceive instability. they hesitate; when they see continuity. they keep coming.
MetLife’s move comes after years of pressure on big indoor malls. pressure made sharper by the pandemic and its ripple effects.. Water Tower Place was hit hard as major tenants left—Macy’s closed in 2021. followed later by brands including Gap and Banana Republic.. A year after those changes began. MetLife took over the property. effectively assuming both the risk and the opportunity of returning the center to a position where it can compete with the best shopping districts in the country.
Before the pandemic, Water Tower Place carried about a 15% vacancy rate for specialty stores.. Now, the vacancy rate is roughly 30%—excluding the space vacated by Macy’s.. The mall still has a footprint of well-known brands and experiences. including Lego and American Girl. Adidas. and attractions such as the Chicago Sports Museum.. But the gap between “known names” and a fully activated retail mix is where the redevelopment is aimed.
One reason MetLife believes the timing is right is what’s happening just outside the mall doors.. Nearby Michigan Avenue has seen renewed momentum as newer retailers continue to open—brands such as Mango and Uniqlo have arrived. while American Eagle has plans for a flagship.. In that context. Water Tower Place doesn’t just need stores; it needs to feel aligned with the street’s recovery.
The owner’s strategy also leans into a shift that’s now common in modern retail: experiential concepts are increasingly treated as anchor draws. not afterthoughts.. Water Tower Place already includes entertainment options. and the redevelopment aims to bring in more attractions designed to keep visitors inside longer and make the mall a stop rather than a detour.. The leasing team has pointed to new retail and novelty destinations—such as a Harry Potter shop and other concept-driven offerings—that can change how cautious retailers evaluate a location.
For shoppers. the goal is a different experience than what many people associate with aging malls: more open sightlines. more reasons to linger. and a broader mix of categories aimed at customers who shop with higher expectations for design and selection.. The redevelopment is intended to entice upper-middle-class shoppers. with plans to target women’s specialty stores. apparel and beauty brands. and experiential concepts.. The leasing team estimates filling around 10 vacant storefronts. suggesting the renovation is paired with an active push to rebuild the center’s tenant roster.
Food and beverage is expected to play a significant role in that transformation.. Several cafes and bars are likely to replace the former Foodlife food hall on the mezzanine level.. Discussions have already begun with “significant Chicago-based restaurant operators. ” signaling that the next phase of competition won’t be limited to what brands line up on storefronts. but also to what kind of dining and nightlife energy the property can host.
The bigger question for Chicago is whether this kind of reinvention can restore long-term resilience.. MetLife’s plan—retail up front with an inviting. open atrium. plus a mixed-use tilt higher in the building—reflects an industry reality: foot traffic patterns changed. and stability now often comes from blending uses that can share the same address.. If the redevelopment helps Water Tower Place ride the momentum returning to North Michigan Avenue. it could set a template for how major urban malls pivot from “one big tenant mix” to a more diversified. experience-driven destination.