Apple to Spruce Up Chicago El Stop Near New Store

Marketer Will Spend $4 Million on Renovation, Possibly Get Naming Rights to Station

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CHICAGO (AdAge.com) -- The North and Clybourn station on the Chicago Transit Authority's Red Line may become the iStop.

Apple will spend $4 million to spruce up the el stop at North and Clybourn.
Apple will spend $4 million to spruce up the el stop at North and Clybourn. Credit: Erik Unger
In exchange for Apple spending more than $4 million to renovate the scruffy station, the CTA gave the maker of MacBooks and iPhones first dibs on naming rights, if the agency decides to go that route, according to a report in Crain's Chicago Business. It's apparently the first such deal by the cash-strapped CTA. Apple also gets the exclusive right to buy all the ad space in the station, at 1555 N. Clybourn Ave.

The CTA has been considering naming-rights agreements since at least 2005, but the idea is seemingly getting another look as President Richard Rodriguez scrambles to avoid hiking fares and cutting services to cover next year's projected budget deficit of $178 million. A CTA spokeswoman did not respond to questions.

Cities nationwide are increasingly looking at corporate sponsorships to ease budget woes. The risk to the CTA is that slapping corporate logos on stations could confuse riders and cheapen the city's image, and make only a small dent in the massive financial problems.

"We are selling everything, aren't we?" said Joseph Schofer, director of Northwestern University's Infrastructure Technology Institute. "We haven't come to the point where we recognize how critical the system is to the economy, and provide it with long-term, stable funding."

The Apple store, expected to open next year, and the station are on a triangular parcel bounded by Halsted Street and North and Clybourn avenues.

The naming rights and advertising deals are part of a little-noticed agreement with Apple the CTA board approved in August. In return for the renovations, Cupertino, Calif.-based Apple would receive a right of first refusal to buy naming rights if the CTA decides to sell them. The price would be based on the market value as determined by a consultant to be hired by the CTA, the agreement says.

Even without the naming rights, the stop will likely be known as the Apple station because the company is also receiving a right of first offer at going rates on all advertising in the station, where it will install seven lighted ad displays.

The renovation won't change the look of the 1940s-era brick station, although an unused bus lane between the station and the new store would be replaced with a landscaped open space.

An Apple spokesman confirms that the company is working with the CTA on the renovation, but declines to comment further.

Spending more than $4 million to spruce up somebody else's property is an unusual tack for a retailer, but Apple is known for spending lavishly on its signature locations.

"Apple thinks their products are designed and work the best, and they want the stores to reflect that attitude," said Michael Damore, executive managing director of Chicago-based architectural firm Epstein, which co-designed the Apple store at 679 N. Michigan Ave. but isn't involved in the North and Clybourn store. "They don't care what they spend to achieve that goal."

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Thomas A. Corfman is a senior reporter with Crain's Chicago Business.

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