June 14, 2010
The revamped Pitt Street Mall soon will be home to many high-end retailers, writes Carolyn Cummins.
The facade at the corner of Market and Pitt Street. To be ready for the October 2010 mall opening (pic- JWA)
It is being played like a game of musical chairs but by the time the work is finished, Sydney’s Pitt Street Mall and the surrounding streets will be a who’s who of retailers. And rents will rise accordingly. Once the new stores open, rents are tipped to double from their present levels of about $8000 a square metre.
But the list of occupants is unlikely to boast overseas fashion names such as Zara and H&M, which prefer their own stand-alone flagship stores as opposed to being in an enclosed shopping mall.
Zara, whose head office is in Spain, is said to be using Solomon Lew as its co-agent in Australia and is looking at a number of sites in the CBD. So far it has not signed any leasing deals in Australia.
However, shoppers who like the US chain Gap will be pleased to hear that it has signed for an 800-square-metre shop within the new Westfield Sydney.
The same scene in July 2010. Showing the pedestrian bridge that has just been demolished.
BusinessDay has seen a list of the new retailers to have signed up for the centre and it includes the majority of tenants which used to be in Centrepoint and the Imperial Arcade.
The new Skygardens Castlereagh Street elevation (pic- JWA).
Interior of the 85 Castlereagh Street tower lobby, looking up. To be ready for the February 2012 opening (pic- JWA).
The 85C skylobby at retail level 7 (pic- JWA).
A Coach store selling upmarket bags and some apparel will open on the corner of Pitt and Market streets.
Nespresso, Tag Heuer watches and Guess will open on the ground level of Pitt Street Mall.
At 182 Pitt Street is the former Emporio shoes site in the building which the Goddard family, declined to sell to Westfield. That site will be redeveloped next year.
The 85C tower on the skyline (pic- JWA).
Next door, within the Westfield complex, will be Esprit, Cue and Sportsgirl.
Westfield’s leasing team has created an upmarket strip on Castlereagh Street, opposite David Jones, having secured Prada, Gucci and Zegna.
On Market Street, with both David Jones stores nearby, will be a Mui Mui store.
On the upper levels of Westfield there will be a Thomas Dux supermarket, run by Woolworths to take on the David Jones food hall.
Discussions are also under way for a signature chef, such as Gordon Ramsay, to open a restaurant.
The stockbroker JPMorgan and Westfield staff will move into the planned skyscraper at 85 Castlereagh Street, atop the former Imperial Arcade.
Former tenants in that arcade, including Borders book store, are returning. JB Hi-Fi is looking to open a new ”wi-fi” concept store.
One of the favourites of city workers, the Sky Phoenix Chinese restaurant, has also re-signed in the redevelopment.
Christian Dior is rumoured to be taking the Louis Vuitton site on the corner of Castlereagh and King streets, while Bottega Veneta, Christian Louboutin and Mulberry are looking for prime sites.
Knight Frank’s associate director of retail leasing, Alex Alamsyah, said an influx of high-profile international retailers was inevitable and could transform the CBD.
”The level of refurbishment and redevelopment activity currently in progress is opening up many opportunities for big fashion brands and will help put Sydney on the map as an international retail destination,” Mr Alamsyah said.
“Whether it be through the granting of licensing or franchising arrangements, as is the case with Gap and Victoria’s Secret, for example, or alternatively the rollout of corporate-owned stores such as Esprit and Louis Vuitton, it is clear that Sydney CBD is a global hotspot for the upper echelon of major international fashion brands.
“And the current wave of new projects means these brands have the opportunity to make their play.”
While retail landlords and shoppers alike would love to see more overseas retailers there are a few hurdles that need to be overcome before some of the international fashion retailers – such as Forever 21, Uniqlo and Abercrombie & Fitch – can enter the domestic market.
But these stores are said to be keen to establish a presence.
Mr Alamsyah said that for the past decade Sydney had been on the radar of numerous big fashion brands, yet certain barriers had prevented them from setting up shop.
“First, our seasons differ from the northern hemisphere, which affects fashion retailers significantly. Second, our location generally incurs higher shipping costs from major distribution points and there are comparatively high import duties on clothing and shoes, and finally, wages and rentals are higher in Australia, making it harder to launch a new brand here in comparison,” he said.
Josh Loudoun, CB Richard Ellis’s regional director of retail services for Australia and New Zealand, said the concerns for the international brands were that they wanted space of up to 2000 square metres as a standalone flagship, such as the Apple store in the city.
A section through the retail and 85C tower (pic- Culwulla).
”There are affordability issues as Australian retail landlords charge very high occupancy costs which, when combined with high wages, import taxes and currency movements, the return in investments for these groups sometimes does not stack up,” Mr Loudoun said. But he said despite the hurdles, many were in talks about opening here.
Opposite the Westfield centre there are other moves afoot, with the jeweller Angus & Coote taking Witchery’s former space in Sydney Central Plaza.
Hype DC has signed a new lease at Mid City facing George Street and also at 239 Pitt Street. General Pants has a new lease at Mid City and wants to leave Glasshouse; Strandbags has renewed its lease at the Strand Arcade; and Jurlique’s space at the Strand is available for lease as it has moved to Mid City facing George Street.
Additionally, restaurants including Golden Century and Kam Fook Yum Cha are taking leases at Star City casino and Sydney Airport respectively, while the first Godiva and Victoria’s Secret stores have opened at Sydney’s international terminal.
Images- Copyright JWA Architects