The Paris-based label will anchor the new high-end fashion precinct in the former David Jones menswear store, which mall owner Scentre group is constructing on the corner of Market and Castlereagh Streets.

Elliott Rusanow, Scentre chief executive said once it opens later this year, the venue will have 6000 square metres of luxury retail space over five levels, including the new Chanel boutique and other brands like Moncler, Omega and Canada Goose.

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Revenue from luxury goods is expected to grow at an annualised 5.4 per cent over the next five years and top out at $5.3 billion. It accounts for an average 18 per cent of Australia’s total retail sales, IBISWorld estimates.

CBRE research shows Melbourne’s struggling CBD retailers are fighting back.

The central city has seen a dramatic fall in retail vacancies to 7.37 per cent in the second half of 2023 – the lowest in Australia – from 10.7 per cent. Vacancy in the core is even tighter at 3.6 per cent. Shops are also finding tenants in the CBD’s non-core strips and arcades are where vacancy sits at 6.7 and 13.9 per cent respectively.

The City of Melbourne’s average daily pedestrian count also shows people are back in town. Traffic on the Bourke Street Mall last month was 9 per cent higher than in January 2024 and 6 per cent higher than in February 2023.

Cushman & Wakefield’s Cam Taranto and Michael Di Carlo had been quoting around $1 million a year in rent for Michael Hill’s new 488 square metre space – about the same as Pandora’s deal in 2017 – but sources suggest the jeweller nabbed a discount, paying around $900,000.

The agents declined to comment on the lease which mops up one space as another opens. They are also marketing the old Foot Locker shop, at No.327 Bourke Street, on the corner of Causeway Lane.

“It’s a thrilling period for the Mall post-Covid with numerous developments now reaching their final stages. We anticipate a surge of new retailers and investments from both national and global players,” Taranto said.

Half the southern side of the Mall is a building site as Newmark Capital finishes work for the new Mecca flagship at the old David Jones site and a new hotel is being built on the old Walk Arcade.

Matt Hudson, managing director of Hudson Capital, said a number of new brands have identified Sydney and Melbourne as key markets globally.

“Where previously these brands would have entered the markets under a licence arrangement, we are now seeing them come in directly with stand-alone stores,” Hudson said.

“An example is the vast number of watch brands that were previously under licence with groups such as Kennedy, they are now operating as individual stores. This leans into the concept that they are aspirational purchases and in high demand.”

Other new brands that have opened in Sydney include Ralph Lauren at 138 Pitt Street, Vacheron Constantin at 104 King Street and Valentino, Dolce & Gabbana, Brunello Cucinelli at 25 Martin Place. Paspaley jewellers and Roger Dubuis are at 60 Castlereagh Street, while Paiget are at 175 Pitt Street.

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