As the doors swung open at Mecca’s new flagship store in Melbourne on Friday, the bustling scene was a stark contrast to the city’s recent quiet. The cosmetics giant’s latest venture is being hailed as a potential turning point for Melbourne’s Central Business District (CBD), which has struggled to regain its pre-pandemic vibrancy.
“I think there’s definitely going to be a halo effect in the CBD and you’re already starting to see it,” said one enthusiastic shopper who took a day off work to attend the opening. “I think you’ll start to see neighbouring businesses opening up and it will give a lot of people hope. Melbourne may have slept for a little while during COVID but we’re back.”
This sentiment was echoed by others in line at Mecca’s expansive new emporium. One woman noted the lengths people had gone to be part of the event. “I think it’s going to bring more people in … even today, people have flown in from interstate just for today so what does that tell you?” she remarked.
Revival Amidst Challenges
The opening of Mecca’s megastore, billed as Melbourne’s “biggest retail opening” in a century, comes at a time when the city is witnessing a gradual revival in consumer activity despite a sluggish post-pandemic recovery. Approximately 20,000 people were expected to visit the store on its opening day, with eager customers lining Bourke Street as early as 4 a.m.
Jo Horgan, Mecca’s founder, envisions the store as a cultural landmark for Melbourne. “We want it to be just as synonymous with Melbourne as the National Gallery of Victoria or the Australian Football League,” Horgan stated.
Economic Indicators and Retail Trends
While Melbourne’s office vacancy rates remain the highest in the country at 17.9%, the retail sector is showing signs of resilience. The retail vacancy rate in central Melbourne was 5.5% last month, a significant drop from its peak of 27.9% during the COVID-19 lockdowns. The broader CBD retail vacancy rate was 7.8%, according to the City of Melbourne.
“We’re seeing a strong surge in businesses opening their doors in Melbourne — from global brands to local heroes — fuelling the fire of the city’s retail revival,” said Councillor Kevin Louey.
Pedestrian foot traffic on Bourke Street Mall has also shown improvement, reaching 70.5% of pre-COVID levels in July. This uptick is supported by data indicating that Melbourne’s economic output has consistently outperformed both Victoria and Australia over the past two decades.
Expert Insights on Retail Dynamics
Dr. Bo Pang, a consumer expert from the Swinburne Institute of Technology, views Mecca’s ambitious 4,000 square meter project as a testament to the enduring appeal of physical retail. “While some may see this as a risk, it’s also a visionary bet on the future of retail, where connection, discovery, and human touch remain irreplaceable,” he explained. “The stakes are high, but so is the potential reward for redefining what physical retail can be.”
Despite the rise in online shopping, which now accounts for 11% of all retail in Australia, surveys show a majority of consumers still prefer in-store experiences. E-commerce leader Mal Chia highlighted the resurgence of brick-and-mortar stores as a key trend. “The narrative of physical retail’s demise has been thoroughly debunked by the sustained resurgence of brick-and-mortar since pandemic lockdowns lifted,” Chia noted.
Future Developments and Investments
The Mecca flagship launch precedes several other major retail projects in the area, including Melbourne Walk, Collins Arcade, and Town Hall station, all set to open later this year. Retail leasing expert Zelman Ainsworth believes these developments will drive further investment and attract businesses of all sizes.
“There’s been several developments recently in the CBD retail core which coincidentally happened around the same time, so it created some disruptions to the traffic flow in the retail core,” Ainsworth said. “But now they’re all being delivered at the same time. The Melbourne CBD has never experienced such a rejuvenation, hype and uplift in decades.”
Ainsworth emphasized that the city’s retail resurgence is not just about large chains but also about smaller, creative retailers that contribute to Melbourne’s unique charm. “We’re seeing retailers starting to go up multi-level buildings, into lower grounds, into laneways, into rooftops,” he added.
Despite high office vacancy rates, Ainsworth is optimistic about the retail sector’s future. “The artisan, more creative retailers that create the charm the Melbourne CBD is world-famous for, is only improving,” he said.
As Melbourne continues to navigate its post-pandemic recovery, the opening of Mecca’s megastore may indeed signal a new era for the city’s retail landscape, offering hope and opportunity for businesses and shoppers alike.
