Melbourne CBD leases – June
Melbourne’s CBD retail rebound continues to translate into new leasing deals being struck.
Fitzroys’ Franklin Gikas and James Lockwood have just negotiated several new leases on secure terms to a range of tenants across the CBD.
“We continue to see a resurgence in foot traffic and customer activity in the CBD on the back of a booming night-time economy, major events, the return to the office and the upcoming completion of the Metro Tunnel,” Gikas said.
“More operators are looking to be a part this revival.”
According to Fitzroys’ latest edition of Walk the CBD, retail vacancies in the Melbourne CBD have come down over the past 12 months from 8.0% to 6.1%, and have been slashed by more than half since recording 14.1% two years ago.
Headlining the latest deals is a 5+5-year lease to Creed Perfume at Shop 27, Royal Arcade, struck at S3,500 per sqm by Gikas and Lockwood.
Creed, which has a legacy dating back to 1760 in London, began as a tailoring house for royalty before expanding into luxury perfumery in Paris in 1854. This new store in the historic Royal Arcade marks Creed’s second Australian location, joining its Sydney boutique in the Strand Arcade.
“The refined character of the Royal Arcade provides the perfect setting for Creed’s timeless elegance and storied heritage,” Gikas said.
Dan McCormack, National Retail Manager at Creed’s local operator Agence de Parfum, said, “The Melbourne CBD has always been the beating heart of Australian retail – unlike any other shopping environment. Its laneways, cafes, and restaurants give it a European flair and offer more than just major malls and international chains.”
“Customers are craving immersive brand experiences – something that’s long been missing for many of the global brands we represent in Melbourne. These stores offer a sense of nostalgia for those who first discovered the brand overseas, and for new customers, it’s an introduction to the authentic boutique experience,” he said.
At 1/360 Bourke Street – opposite Bourke Street Mall – Gikas and Lockwood have confirmed completion of a seven-year lease to Paramount Liquor-backed Bottlestop, which is opening its first flagship store in the heart of the CBD.
“This is a strategic location for Bottlestop to launch its Melbourne CBD retail presence,” Lockwood said.
“This high-exposure tenancy offers the opportunity to capitalise on Bourke Street Mall’s repositioning which will see completion of the S150 million Melbourne Walk development, which will bring two new IHG Hotels to the centre of the city, as well as a JD Sports Australian flagship store, and transformation of the former David Jones menswear store into a Mecca flagship, a new Rodd & Gunn concept store, and office space.”
Lockwood also said, “Tenants are recognising that there is currently an excellent opportunity to establish a presence in the CBD in quality positions and on competitive leasing rates, with a number of businesses looking to lock in long-term deals.”
At Shop 6, 271 Collins Street, fronting Flinders Lane, Gikas and Lockwood negotiated a 3+3-year lease to expanding national tenant I Heart Kpop. Following on from stores in Sydney and Brisbane, I Heart Kpop is making its Melbourne debut after a number of successful pop-ups in the CBD.
“The store brings Korean fashion, pop culture, and fan energy to Flinders Lane, and is expected to attract strong foot traffic and devoted fans,” Gikas said.
At Shop 2/11 Manchester Lane, established footwear brand Merry People will open its first bricks-and-mortar store in the CBD after nearly 10 years of presence through its online store, warehouse outlet, and national stockists.
Meanwhile, Gikas and Lockwood have leased a 148sqm corner hospitality space, directly connected to GPT’s innovative Space & Co co-working lounge and event space, at 181 William Street to premium Japanese concept Attakai on a long seven-year term.
Created by the team behind Le Yeahllow and White Mojo, Attakai will bring high-quality fit-out, elevated sandos, specialty coffee, and a vibrant offering from Samsky and team.
Hospitality, food and beverage and entertainment operators again drove the take-up of space over the past 12 months, with the proportion of these spaces increasing from 40.9% to 47.4% – and up further from the 34.1% at the beginning of 2023 – according to the latest Walk the CBD report.
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