By  on July 10, 2007

CHICAGO — Nicole Miller decided to take matters into her own hands.

Less than satisfied with her real estate broker's recommendations for a new store location here, the designer got a guidebook and began scouting neighborhoods herself, finally settling on Wells Street, a tree-lined thoroughfare in the Old Town neighborhood that was known more for restaurants than retailing.

Miller's decision to abandon fashionable Oak Street, where neighbors included Hermès, Prada and Kate Spade, when her lease expired last August after eight years, reflects the desire of many designers and retailers to find neighborhoods that help generate freshness and new customers. Whether in Old Town here or the Meatpacking District in lower Manhattan, these merchants are looking for offbeat, quirky and distinctive locations.

Although space along Michigan Avenue's famed Magnificent Mile here, as well as on Oak Street, remains in high demand, a handful of thriving neighborhoods have developed here that were blips on the retail radar until residential construction boomed in recent years and led to gentrification. This occurred as some merchants sought alternatives when rents reached $400 per square foot along Michigan Avenue and $200 per square foot on Oak Street, where Jimmy Choo took Nicole Miller's former space, Harry Winston and Bebe plan to open this year and Barneys New York is doubling in size.

"Developers are looking to develop communities that cater to the consumer and keep them in the neighborhood,'' said Melissa Turner, Chicago's director of fashion, arts and events. "They're looking for a portfolio of business and residential.''

And residents want more close-to-home retail options in gentrifying Chicago neighborhoods like Old Town, Bucktown and Lake View.

"Everybody is looking for a new opportunity where [retail] rents aren't so crushing and they're going to where their customer is,'' said Keven Wilder, a Chicago retail consultant.

Miller said her two-level, 2,400-square-foot store, which opened in October, is projected to generate $1 million in its first year, an increase of about $250,000 from the almost 2,000-square-foot Oak Street location.

"I'm drawing people who haven't been in the store for a while,'' she said. "We're revitalized.''

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