Fashion fight: Sydney vs Melbourne as global brands queue to get in - BRW (subscription)

Some arguments never die: the Melbourne vs Sydney stoush is one of them. It’s been fought over food, bars, beaches, fashion, public transport and cost of living. Now, with the new Melbourne Emporium set to open later this year, the war is being fiercely waged over international retailers too.

Since sports apparel brand lululemon athletica first entered the Australia market in Melbourne in 2004, it’s become a contest - even among shoppers - over who gets first dibs on the likes of Pottery Barn, H&M or Sephora.

But according to one expert, the only thing driving the openings is suitability of space.

To date, more international retailers have opted to set up their flagship store in Sydney rather than Melbourne, according to residential and commercial property firm Colliers International. There are still many, like H&M and Sephora, who are yet to reveal where their first store will be.

Colliers’ head of retail Michael Bate says Sydney’s been favoured only because of Westfield’s new centre in the city.

“The only reason that Sydney has been more popular than Melbourne is because of the huge investment that Westfield has made to develop their CBD flagship centre on the former Centre point site,” he says.

Melbourne is nonethless a “far more sophisticated fashion market than Sydney,” Bate says.

The chief executive of homewares giant Williams Sonoma, Laura Alber, just opened the first store in Sydney in May. Alber told BRW they chose Sydney only because they found the perfect building.

According to Colliers International research, Sydney takes the top spot, with nine retailers opting to set up their first Australian store there. Melbourne follows with five and Adelaide has scored three.

But the balance will change again with the new Emporium Melbourne which is set to open in late 2013 on Lonsdale Street. The shopping centre will host 225 local and international retailers.

“Melbourne will certainly catch up with Sydney when Emporium and ISPTs GPO/Strand developments open early next year,” Bate says.

Some of the international brands that have committed to these new developments has mean that Melbourne will take the lead with the number of international brands by mid year, he says.

One of those retailers is Japanese casual fashion label UNIQLO, which has chosen Melbourne for its first Australian store.

To date, more international retailers have opted to set up their flagship store in Sydney rather than Melbourne.

Another lululemon athletica store, MARCS, SABA, Coach, Mulberry, Lacoste and MAX&Co are among other brands confirmed to open up in the new Emporium.

Lisa Ho is meant to be opening up another store in the new mall as well but that may change after the high end fashion retailer fell into administration earlier this month.

Not to be outdone, Sydney will also gain luxury lingerie and swimwear brand La Perla at Sydney Airport. La Perla previously had a store in Melbourne but it closed down. Victoria’s Secret was another international first at Sydney’s airport in 2010.

The second wave

Bate says there are a lot more retailers who are going to come.

“I call it the second wave. The initial success of Zara, Topshop and several other luxury brands has filtered through the retailing community and that has lead to the elevated interest from the next wave, Uniqlo, H&M, Gap. Once they get their foothold into the country and their success is filtered through the retail network and family the next wave will follow.”

But for those feeling burned by their favourite retailer for not coming to the city where they live first, spare a thought for your western friends: Perth gets nowhere near as much attention from international retailers.

Perth went into excitement overdrive this month when Zara and Topshop were rumoured to be close to opening stores there.

Bate, who is currently meeting with several big brands overseas in the United States, agrees it is rare for the big international brands to bypass Sydney and Melbourne.

“Several [retailers] that I have spoken with over theist few days here in the US all want the other capitals, but only after they have established a presence in Sydney and Melbourne,” he says.

“One of the interesting ones to reinforce that yesterday was Abercrombie & Fitch. They opened Hollister in Bondi and shortly after in Doncaster and will not do any more stores until they read the market with these two.”

The next trend

Bate reckons the next trend Australia will see is consolidation of its local brands.

“This last happened in the mid to late nineties, when the last wave of internationals entered the market. My guess is some of the bigger Australian network owners will consolidate brands and buy up existing brands to compliment their own stable and there will be unfortunately a lot more [to] disappear.”