Collins Streets top towers turf the lobby and let in luxury

Article3 min17 June 2017By Simon Johanson - the article was originally published by The Sydney Morning Herald June 17 2017.

The cold stone corporate lobbies in Collins Street's top towers are being cleaned out and high-end retailers are moving in.

Space, particularly on Melbourne's premier street, is valuable and building owners have moved to take advantage of it, re-engineering their foyers to include vibrant eateries and upmarket retailers.

Property giant Dexus is the latest to refurbish and convert what was once a large ground floor foyer at 360 Collins Street into high-end retail and eateries.

Across the road at 367 Collins, diversified group Mirvac is midway through a similar reconstruction.

And further west along the famed strip, private developer Equiset is close to completing a $100 million transformation of its massive Rialto forecourt.

The era of the spacious, majestic tower lobby displaying the power and might of the corporations within appears to be over.

“People are now looking for more casual and relaxed ways to work beyond their office walls,” Dexus’ head of office portfolio Ellie Schwab said.

The refurbishment of 360 Collins was driven by tenant demand for “third spaces”, casual lounges, shops, cafes, eateries and Wi-Fi-connected areas where employees can meet and work informally.

The shift was partly generational, she said. Millennials, in particular, were keen to work in different spaces and take advantage of the mobility technology enabled.

The building’s foyer now included multiple charge points for laptops and phones and fast Wi-Fi connections.

The upside for the Dexus Wholesale Property Fund, the owner of the building, is happier tenants and extra income from two prime retail tenancies facing Collins Street and eateries at the rear of the tower.

Dexus head of retail leasing Eddie Giraldo confirmed a “heads of agreement” had been signed with two luxury watch retailers to take the space on Collins Street, but would not reveal the brands.

New retail plaza opens with fanfare at 360 Collins

The era of the spacious, majestic tower lobby displaying the power and might of the corporations within appears to be over

BusinessDay has learnt Swiss luxury watchmakers Panerai and IWC will open in the 75-square-metre glass shops fronting 360 Collins, paying more than $2000 per sq m in rent.

Both Panerai and IWC are controlled by luxury goods retailer Compagnie Financiere Richemont SA which also counts Dunhill, Piaget and Cartier among its brands.

On the ground level, seven new eateries will include a fully licensed 8bit Burgers, PappaRich and Sush & Nori.

Mirvac is also believed closed to signing retailers for a similar refurbishment of 367 Collins, where two glass wings that front on to the street were also being targeted at luxury retailers.

The upgrade will include eateries at the rear of the building on the ground floor.

Equist director Lorenz Grollo said the Rialto’s revamp was nearly complete.

As well as 5000 sq m of new office space, the refurbishment includes large retail spaces for Mercedes Benz, mens fashion retailer MJ Bale, Bank of Melbourne and St Ali coffee house.

Mr Grollo said the intent was to “modernise” the building for the new type of workspace where the ground floor becomes an informal meeting space.

“It’s no longer a cold stone foyer that was so dominant in 1980s and 1990s. It has become more of a place for interacting and events. That’s a global trend. Having a ground floor that’s highly interactive is part of the office of the future,” Mr Grollo said.

Collins Street is seeing a building renaissance with a construction boom of around 200,000 sq m of new office space underway due for completion between 2018 and 2020.

As well as construction at the Rialto, Mirvac has started building a premium-grade office behind the historic Olderfleet building at 477 Collins Street.

The 40-storey tower designed by Grimshaw Architects will rise behind the 1880s Olderfleet facade and include food and retail outlets on the ground floor.

Superannuation-backed Cbus Property is working on another tower, dubbed the Pantscraper, at 447 Collins Street.

Further west again is Lang Walker’s $2.5 billion Collins Square project and next door is Lendlease’s $2.5 billion Melbourne Quarter on the Batman’s Hill.

LendLease is building offices and apartment towers combined with a sky park.

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