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Docklands’ Waterfront City developers will use heavily discounted fashion labels to enter a vastly expanded city retail market.
Waterfront City’s joint venture partners, ING Real Estate and the Lewis Land Group, this week announced plans for the $600 million first stage development of the $1 billion project, to be completed in time for the 2006 Melbourne Commonwealth Games.
The precinct, set to include 36,000 square metres of retail space, will open after the city’s retail market has expanded by 140,000 sq m, basically equivalent to Melbourne’s largest suburban shopping centre, Knox City.
Of Waterfront City’s 36,000 sq m, approximately 20,000 sq m will be filled by “direct brand” retail outlets.
Direct brand outlets would include major fashion brands and manufacturers such as Oroton, Esprit and Polo Ralph Lauren, selling current and post season fashion, discounted by up to 60 per cent.
Waterfront City will be the second bargain outlet west of the city centre, with the group Direct Factory Outlet (DFO) taking up 27,000 sq m in the Spencer Street Station redevelopment in 2005.
Melbourne already has a direct brand outlet in Nunawading, called Brandsmart, while DFO operates at Moorabbin and is planning another outlet for Essendon.
The 19.3 hectare site will include 135 low rise residential developments aimed at the owner occupier market, priced between $450,000 and $1.5 million.
There will also be a marina, entertainment piazza and the 120 metre high Southern Star observation wheel.
With its entertainment zones and waterfront access, the retail precinct was designed to be a day out for families and tourists, Waterfront City project manager William Peppard said.
He would not say whether the group had any firm commitments to take up space, but said it was talking to existing direct brand retailers, as well as international fashion groups.
Retail space due to be completed in the central business district by the end of this year includes 46,000 sq m of the partially complete Queen Victoria site and 8000 sq m at the GPO Centre in Bourke Street.
Existing space of 56,000 sq m is being refurbished at Melbourne Central, with another 3000 sq m being added. The 27,000 sq m Spencer Street redevelopment will be finished in 2005.
CB Richard Ellis director Josh Loudoun said he believed Waterfront City’s retail concept was not likely to compete directly with city retailers because it would target a different market.
“This concept does not exist in the city and they are bringing in customers for a different spend,” Mr Loudoun said. “They are introducing something new and not simply replicating something that already exists.”