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Melbourne shopfronts spring to life with Australia’s lowest retail vacancy rate

7 June 2024

One of the city’s most-loved laneways, Centre Place, is springing to life with small businesses – as new data shows Melbourne continues to record the lowest retail vacancy rate in the country.

After reaching a record high of 31 per cent in 2021, the City of Melbourne’s latest Melbourne Economy Snapshot reveals retail vacancy rates in the CBD have halved in the past year – dropping from 13 per cent in April 2023 to a low of 6.5 per cent in April 2024.

The broader municipality’s retail vacancy rate is also down to 10.7 per cent, dropping by a third in the last 12 months – proving the City of Melbourne is an unrivalled place to do business and invest in.

The Snapshot also reveals more people are coming into the city on Mondays during peak morning commute times, without a drop in attendance on other weekdays – with Flinders Street Station in February recording its busiest Mondays since 2020.

This uptick in commuter activity coincided with an increase in dining and entertainment spend, which has tripled since 2021 – showing workers are making the most of their time in the city and supporting traders on more days of the week.

Next-door neighbours in Centre Place – famous hot-chocolatier, Mörk and trendy upcycling boutique, Beekeeper Parade – are two of the 15 businesses that have activated empty shopfronts in the past year, thanks to Council’s Small Business Grant program.

They join over 800 others who opened shopfronts across the city in the past year – creating new jobs and more reasons to visit the city.

Our neighbourhoods are also reaping the benefits, as more restaurants and cafes set up shop in Carlton, North Melbourne and Kensington – where shopfront vacancy rates have dropped around 40 per cent in the past two years.

In the same period, retail vacancies on Lygon Street decreased by over 50 per cent – which is great news for local traders and visitation.

Since retail vacancy peaked in 2021, Council has been working to fill empty shopfronts. Key initiatives include the $2.6 million Shopfront Activation program in partnership with the Victorian Government, the annual $500,000 Small Business Grants program, and the establishment of Business Concierge – with an extra $1.6 million allocated to expand the service in in the draft Budget 2024–25.

To view the latest Melbourne Economy Snapshot, visit City of Melbourne.

Quotes attributable to Lord Mayor Sally Capp

“Across every street, down every laneway and behind every corner, there are businesses waiting to be discovered by visitors – it’s one of the best things about our city.”

“Melbourne means business – we’ve once again recorded the lowest retail vacancy rate in the country, showing the city is heaving with activity and support for local retailers.”

“We understand there are many precincts and traders finding it more difficult than normal to do business right now – and we’re doing what we can to support them, including offering grants and expanding our Business Concierge team.”

“We’ll continue to invest in our unrivalled diverse and unique retail scene – and backing businesses that add to the city’s vibe and show the world why Melbourne is the place to be.”

Quotes attributable to City Activation portfolio lead Councillor Roshena Campbell

“We’re so proud Melbourne has the lowest retail vacancy rate of any Australian city, with our rates reducing faster than anywhere else in the country.”

“It’s great to see neighbourhoods beyond the CBD are also seeing shopfronts springing to life – with promising downward vacancy rates in Carlton, North Melbourne and Kensington.”

Quote attributable to Business and Global Opportunities portfolio lead Councillor Kevin Louey

“Our low shopfront vacancy rates are a testament to Melbourne being a great, welcoming and vibrant place to do business and invest in.”

Quote attributable to Small Business portfolio lead Councillor Jason Chang

“We’re excited our Small Business Grants program have helped Mörk and Beekeeper Parade make their mark in Centre Place – one of the city’s most iconic laneways.”

Quote attributable to Mörk Chocolate co-founders Kiril Shaginov and Josefin Zernell

“Opening our new venue Mörk Looking Glass is a dream, and the fruit of 12 years as a specialty business.”

“With City of Melbourne so passionately supporting our project we feel a strong dedication to giving back to our great city, creating memorable experiences for visitors and locals alike.”

Quotes attributable to Beekeeper Parade founder Koky Saly

“The City of Melbourne Small Business Grant has allowed me to open my first permanent shop since the lockdowns.”

“Centre Place is an iconic, thriving laneway – I am super excited to be a part of it. We’ve only just opened shop and have already hired three new staff members to help run things, and upcycled over 90 tonnes of Melbourne’s excess fashion and textile waste.”

“With business going so well, we’ve even been able to open a second shopfront in Block Place – another iconic Melbourne laneway. It’s a dream come true to me, and I can’t wait for the rest of the year.”

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