Cupertino, Calif.-based Apple is moving away from the longtime heart of the Mag Mile, at 679 N. Michigan Ave., and to the edge of the river, which has long served as the unofficial southern boundary of the city's best-known shopping strip. But the emergence of Millennium Park as a top tourist destination in recent years has boosted foot traffic in the few blocks immediately south of the river, helping lead a wave of new development.

“To me, this is a transformational move,” said John Rutledge, CEO of Chicago-based Oxford Capital Group, a hotel developer that just across the river is redeveloping a former office building at 360 N. Michigan Ave. to a boutique hotel called the LondonHouse.

“We think it's a very important milestone and a transformational event in terms of validating Michigan Avenue, all the way to Millennium Park and beyond, as a solid retail destination,” said Rutledge, who is not involved in the Apple deal. “It will be a validator for a lot of other retailers.”

An Apple spokesman declined to comment. The Chicago brokers representing Apple in the deal—John Vance of Chicago-based Stone Real Estate and Anthony Campagni of New York-based RKF—did not return calls.

Last year, Crain's reported Apple was mulling a move out of the 30,000-square-foot building at 679 N. Michigan, where it opened in 2003, in search of a new, refreshed space. Nick Karris, whose firm Water Tower Realty owns that structure, did not return a call.

Ari Glass, Zeller's chief investment officer, declined to comment.

MORE STORES ARRIVING

Last year, his firm disclosed plans to add a glass box on a portion of Pioneer Court, although at the time it was said to be envisioned as an entrance to a riverside restaurant the developer planned.

Since then, the development firm turned its focus to landing Apple as a destination tenant that would be expected to increase interest from other retail and office tenants for its building at 401 N. Michigan, as well as across the street at the Wrigley Building, where Zeller is part of a venture redeveloping the iconic two-tower structure.

Zeller's 401 N. Michigan property is known for public art in the plaza, including large statues of Marilyn Monroe and the subjects of the painting “American Gothic,” as well as a 20-foot-tall snubbed-out cigarette.

The property is surrounded by ongoing and planned developments, including the Wrigley transformation that has included the addition of retail tenants such as a Ghirardelli Chocolate shop and a Peet's Coffee & Tea flagship store.

Near the Wrigley Building, Santa Monica, Calif.-based shopping mall owner Macerich is planning a big project on a prime development site it bought last year for $42 million.

Directly north of 401 N. Michigan, Tribune Media is considering adding a second tower to its Tribune Tower property. South of 401 N. Michigan, the family of Chicago Blackhawks owner Rocky Wirtz is redeveloping an office tower its owns at 333 N. Michigan Ave., a project that includes a new, larger Blackhawks shop.

Across the street from that project, to the west, Oxford plans to open the 452-room LondonHouse in early 2016.

Other projects south of the river include a 42-story apartment tower Chicago-based developer John Buck is building at 200 N. Michigan Ave.

Aside from 679 N. Michigan, Apple's only store in Chicago is at 801 W. North Ave. in Lincoln Park, at the Red Line's Clybourn subway stop. The company has suburban stores in Deer Park, Naperville, Northbrook, Oak Brook, Orland Park, Schaumburg and Skokie.

PROPERTY PRESTIGE

Apple's impact on nearby retailers is significant.

“On average, Apple is going to improve the productivity of a (shopping) center by 10 to 15 percent,” said D.J. Busch, a senior analyst at Green Street Advisors, a Newport Beach, Calif.-based research firm that covers nine real estate investment trusts that own shopping malls and other retail properties.

Part of that impact is the direct result of the huge volume of Apple's sales in its 440 worldwide stores in 2014, which Green Street estimated at $50 million annually per store, or $4,200 per square foot. Overall, malls averaged $525 per square foot in sales last year, Busch said.

An Apple store also boosts a property's prestige and increases foot traffic, he said.

Although the new Michigan Avenue site would not include a self-contained mall, the relocated Apple store is likely to have a similar effect there, he said.

“If Apple goes somewhere, it raises the rent expectations in adjacent retail locations,” Busch said. “I think of Apple along the same lines as Nordstrom, because they're very good site selectors. When you see retailers that are good at selecting their next sites, that's a good indicator of how that area is evolving.”