Trouble For Carson's State Street Project

Gourmet grocer Fox & Obel and trendy surf-wear retailer Billabong are dropping plans for stores in the former Carson Pirie Scott & Co. building on State Street, leaving the ambitious project with only one tenant as it approaches an opening next fall amid the bleakest retail climate in decades.

Adding pressure to the struggling Carson's site: a new mall up the street at Block 37 scheduled to open next year. The two projects, both by Chicago developer Joseph Freed & Associates LLC, are adding almost a half-million square feet of retail space to the State Street shopping district.

The expansion comes as consumer confidence plunges and retailers focus on survival rather than growth. The perilous environment is testing demand for the rejuvenated State Street corridor; it already has dealt a blow to Mayor Richard M. Daley's hopes for a grocer to serve downtown's expanding population.

Read more on Crain's Chicago Business