Smith Street queer bar site raises interest in Fitzroy's growing catchment

UBQ signage lights up the pavement, leading guests upstairs into the open-plan venue, where fun under the disco ball combines dining, drag shows, quizzes, and karaoke.

The block-shaped red-brick building – adorned with three large rainbow pride flags between expansive top-floor windows – is offered fully leased to two tenants, with a valuable seven-day liquor licence allowing trade until 3am for up to 495 patrons.

Within 50 metres of bars including Yah Yah’s and New Guernica, and surrounded by restaurants and eclectic shops, the site benefits from 11 metres of street frontage in a densely built bohemian neighbourhood long associated with Melbourne’s creative community. A roller door at the rear provides access to Little Smith Street.

Around 75 per cent of the entire 664-square-metre floor space – 434 square metres with a balcony overlooking the busy street. – is leased to Melbourne Hospitality Co, which operates UBQ upstairs and the cocktail and events space LCKR Room on the ground floor.

The company is three years into a 10-year lease that runs until 2033 with further options.

“The seven years remaining on the lease is really attractive to investors,” Talbot says.

The remaining ground-floor tenancy is leased to the Australian National Academy of Education, which has operated a commercial cookery training kitchen there since 2018.

According to Fitzroys, the property returns $305,928 a year plus outgoings and GST.

UBQ hosts drag productions, themed dance nights, salsa lessons and community events, and also offers a casual dine-in food menu several nights a week.

LCKR Room operates as a more intimate late-night music venue hosting DJs and curated events.

Talbot says UBQ’s arrival in late 2023 to the strip he described as “the Oxford Street of Melbourne” continued a long-running nightlife tradition at the address.

Before that, Mr Wows Emporium was a fixture of the Smith Street bar scene from 2012 for more than a decade. It was known for its cocktails, old-time debauchery and bocce.

Talbot says the long-term investment opportunity has generated strong early interest.

“We’ve probably had close to 40 enquiries so far,” he says. “The angle here is a passive investment – someone who’s going to buy it and lock it away.

Obviously, the property has quite a good lease profile and a strong hospitality use. It’s that junction of Gertrude and Smith Street – it couldn’t really be a better location.”

Nearby venues, including The Peel Hotel, Sircuit Bar and The 86, help anchor the area’s queer nightlife credibility.

In 2021, Time Out named Smith Street the “coolest street in the world”.

Talbot says the strip has undergone a major transformation over the past decade.

“Smith Street 15 years ago wasn’t as popular – now it really is,” he says. “It’s probably overtaken Brunswick Street as a preferred strip.”

Traditionally a bohemian strip known for its independent boutiques, Smith Street now blends long-running bars and restaurants with national retailers such as Kathmandu, Bonds and Lululemon, alongside food chains including Guzman y Gomez and KFC.

Well-known restaurants such as Vegie Bar and Smith & Daughters keep the strip grounded in its vegetarian and vegan-friendly roots.

Smith Street forms the boundary between Fitzroy and Collingwood, two of Melbourne’s busiest nightlife precincts.

Nearby venues such as Black Pearl and Naked for Satan remain staples of the local bar scene, alongside stalwart pubs like the Builders Arms Hotel and The Standard Hotel.

Just around the corner, Gertrude Street is widely regarded as one of Melbourne’s leading arts and hospitality precincts, home to venues such as Marion Wine Bar, Cutler & Co. and Gertrude Street Enoteca, alongside design-led retailers like Aesop.

Fitzroy’s residential property market reflects the suburb’s popularity with inner-city singles and renters. According to Domain Insight data, the price of an average two-bedroom house is about $1.295 million, while a two-bedroom apartment averages about $835,000.

With a population of roughly 10,000 residents, Fitzroy continues to attract young professionals drawn to the suburb’s proximity to the CBD, its nightlife and its cultural scene.

A number of residential projects are reshaping the Fitzroy and Collingwood precinct, which is well served by the 86 tram that runs along Smith Street.

“Collingwood has been one of inner Melbourne’s most intensive commercial and residential development locations in recent years, boosting the immediate catchment of Smith Street and spurring trade and activity across all hours,” Mills says.

One of the largest nearby projects is the Casa Fitzroy development at 243 Smith Street, where architecture firm Woods Bagot is transforming the former Woolworths site into 124 apartments, new retail and a Woolworths supermarket, with completion expected around 2028.

Nearby, the Victorian government’s $1 billion Fitzroy Gasworks Redevelopment on Alexandra Parade in Fitzroy North, will deliver about 1400 homes, a senior high school and a sports centre The precinct is being rolled out in stages through the late 2020s.

The property is zoned Commercial 1, and development clauses included in the leases allowing potential future redevelopment (STCA).

It last changed hands in 2019 for $4.575 million on a tight 3.4 per cent yield, with Fitzroys reporting at the time that the auction attracted multiple bidders and strong interest from investors and developers.

The property at 95-97 Smith Street, Fitzroy, is scheduled to be auctioned on-site at 1pm on Friday, March 27.