US property group Pembroke will bring fresh glamour to Collins Street and its landmark T&G Building after signing upmarket Italian brand Bottega Veneta as a tenant to its redevelopment of the former KPMG foyer.
Bottega Veneta will join Gucci, which recently expanded into a new 420 square metre space, MaxMara and a third luxury retail tenant, rumoured to be an Italian fashion label.
Pembroke, the investment arm of Boston fund manager Fidelity, took control of the 1930s T&G Building in a $275 million deal in 2015, hiring architects Bates & Smart to bring fresh life to the 12-storey tower following the departure of KPMG.
Bottega Veneta, part of French luxury group Kering Group which owns Gucci as well as brands such as Yves Saint Laurent, Balenciaga and Alexander McQueen, has leased a 387sq m store in a deal negotiated by Zelman Ainsworth of CBRE.
It will be the first street-level Bottega Veneta store in Australia and its first store here to carry both men’s and women’s ready to wear collections when it opens in December.
Matthew Knight, head of Australia for Pembroke Real Estate, said there was a distinct lack of space for luxury retailers at the top end of Collins Street. “It’s very tightly held so any opportunity is highly sought after by new players,” he said.
Mr Knight declined to reveal the rent Bottega Veneta will pay, but said it reflected market rates, understood to between $3000 and $5000 a square metre.
“The rent reflects the quality of the brand and length of tenure and is consistent with what is being achieved across the market,” he said.
“Luxury brands love to clustered together. It’s better for them to have competitors around them as it brings people to the area.”
The refurbishment of the foyer and ground floor is due for completion at the end of January ahead of the arrival of new office tenants which will include professional services giant Accenture, which has leased two floors on a 10-year lease.
Mr Ainsworth said international retailers were attracted to Collins Street on the back of strong sales growth from rising numbers of overseas visitors and local shoppers. “These retailers are enjoying consistent year-on-year growth,” he said.
Recent deals, he said, included Paris menswear retailer Berluti opening a new store two doors down from the T&G building. Also opening soon on Collins Street is a new Burberry store at 257 Collins Street.