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Chapel Street restaurateur Mais Mazloum likens trading on the renowned strip to being locked inside an ark during a flood. He’s not sure if it’s going to keep raining, or the door will soon open onto dry land.
Either way, the tide is turning. He’s waiting to see what happens, but he’s optimistic.
Once known as Melbourne’s premier fashion precinct, the 2.5-kilometre strip has also attracted attention for high-profile crime, antisocial behaviour and vacant shopfronts. But Mazloum says that’s only part of the picture.
Some of the biggest names in property are pumping billions of dollars into Prahran and South Yarra, promising to lure in thousands more people every day.
Mazloum is worried about disruption during construction work on the street and questions whether there will be enough parking, but he believes if smaller businesses can survive the next few years they will feel the benefits.
“Once you have people coming, living or working in the vicinity, these people have to shop, have to drink, have to eat,” the MiddleSouthEast owner said.
“It’s going to be a village.”
The $5 billion Jam Factory redevelopment from Gurner Group and Qualitas is the biggest project but not the only major change approved – or proposed – for the stretch between the Yarra River and Dandenong Road.
Temporary courts for racquet sport padel are being built at the vacant site in front of public housing towers near Prahran Market. A developer has proposed to turn the land into a high-end office, retail and hospitality spot with a gym.
There are plans to redevelop the shuttered Imperial hotel into a venue for 1200 patrons, and the window of the former NAB building on the corner of Toorak Road is emblazoned with an application for a seven-storey mixed-use development.
Mario Lo Giudice’s Banco Group will soon open the Cecil Place hospitality, retail and office space, while Windsor locals are eager to see what’s planned for the former Presentation College site.
While not directly on Chapel Street, the block next to South Yarra station known for its Tudor-style facade will soon include a 13-storry mixed-use development from Oreana, just down the road from the Capitol Grand building.
“I’ve got no interest in developing in areas that are pristine and perfect because we want areas of change,” developer Tim Gurner said of the Jam Factory redevelopment.
“When you drop a $5 billion project, two hotels, active hospitality, active retail, it literally transforms overnight.”
Gurner expects at least 4000 people to live, visit or work at the Jam Factory when it opens in late 2029. It includes more than 800 apartments, luxury hotels and 20,000 square metres of retail or commercial space – including a cinema – across five towers, with the tallest 32 storeys high. The development has approval, and construction has begun.
He said shoppers should expect the likes of Nike, Lululemon and Mecca over the Pradas or Louis Vuittons of the world. There will be 700 parking spaces.
Gurner said he was aware of landlords and investors buying up property around the Jam Factory as “they know what’s coming”, with many offering shorter-term leases until it opens – after which they can charge premium rents.
Earlier this year, Vicland founder Bill McNee snapped up what he calls the “sore thumb” of Chapel Street, the vacant lot at 402-416, for a reported $65 million.
The site has been empty for nearly a decade, and after its stint as padel courts, McNee wants to turn it into a retail and commercial space similar to his high-end developments 33 Cremorne and Toorak’s St Germain. He said the proposed building would include a basement food hall and health club with an outdoor pool, attracting about 2500 people to the area.
Full details are yet to be made public, but images provided by the developer show a 12-storey building.
“We’ve got the chance here to deliver something that really will be beneficial to the entirety of Chapel Street, not just a part of it, but the entire strip,” McNee said.
Credit: HassellHassell
“It’s an incredibly large investment, is quite challenging and risky for us, but we are well positioned to deliver it.”
Developments up to 16 storeys can be built within the precinct under the Victorian government’s draft activity centre plans. McNee has called for a “reasonable conversation” about height to encourage building in areas surrounded by established infrastructure.
Vicland is seeking planning permission through the Development Facilitation Program, which allows the state to fast-track eligible projects. McNee said if the developer received the green light, then construction would begin as soon as possible, insisting it was not a land-banking play.
“There will be more people, there will be more social engagement, and I think when that occurs, the crime sort of disappears,” he said.
Chapel Street’s vacancy rate was about 15 per cent in South Yarra and Windsor in January and just over 18 per cent in Prahran, according to the council.
The Imperial at South Yarra is among the inactive sites, with developer Paul Tuddenham buying the land in late 2024. There are plans for a four-storey venue that would close by midnight, a joint venture with hospitality giant Australian Venue Co.
Tuddenham described the $20 million redevelopment as “not insignificant” but is bullish about the street’s future.
He also applied for planning permission through the Development Facilitation Program, hoping it would be quicker than going through Stonnington Council and said the venue could, if approved, open in mid-2027.
“We’re only prepared to invest all of that time and money because we believe that it can be hugely successful because it’s in a great location,” he said.
Mr Miyagi co-owner Kristian Klein worries it has become trendy to be negative about Chapel Street, describing the mix of eclectic characters as part of the fabric of the street. He said that while the construction rush would have little impact on his business in Windsor, it would be good for the precinct’s brand.
“The Windsor end gets better and better and better every year,” he said.
“It’s a shame some things that happen at other parts of the street tarnish us with the same brush.”
A police spokesperson said Chapel Street crime had dropped 15 per cent over the past year and retail theft was the most common offence.
Local mother Lisa has lived near Chapel Street for 19 years and said the area was increasingly unsafe. She hopes the pipeline of developments will change things, but believes there’s no guarantee as crime and antisocial behaviour are more deep-seated than just empty shops.
“I’m assuming with greater developments there will be more security, there will be a lot more CCTV, so hopefully that will deter people that are looking to steal, rob and vandalise,” she said.
Local Amy Davis is sceptical, fearing the street is too far gone, and thinks it’s easier to shop at Chadstone.
“Having a few buildings isn’t going to bring people when there’s all of the other dirty, dark side going on in the background,” she said.
Stonnington Mayor Melina Sehr said construction was yet to begin on more than 3000 approved dwellings in the Chapel Street precinct, including in the Jam Factory, and an influx of people would boost safety.
Sehr said street corner upgrades and cleaning under way were part of more than $8 million spent over two years through the Chapel Street Precinct Improvement Plan. While she doubts hooning on the strip can be eliminated, she said the council was investigating noise-activated CCTV.
Traders who challenged the council’s Special Rate Scheme have withdrawn their VCAT case, issuing a statement via the council that the improvement plan would support the area in the long term.
Sehr acknowledged the Prahran section had “lost its spark of late”, but hoped the area would lift once an arts and cultural events organisation moved to Prahran Town Hall.
“We hear some negative publicity about Chapel Street. We’re not seeing that,” she said. “There is so much investment going into the street.”
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Rachael Ward is a journalist in the City team at The Age. Contact her at rachael.ward@theage.com.auConnect via email.From our partners
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