Melbourne shoppers spend more as city hums back to life

Melbourne shoppers spend more as city hums back to life

“It’s both exciting and reassuring that we haven’t lost our affinity with hospitality over the last few years and as the data reflects, it’s an industry that has absolutely cemented itself as a part of our daily lives.

“We’re seeing this firsthand in venues — guests are happy to join table waiting lists and maybe wait a little longer in line at the bar.”

Broader data from the city of Melbourne, spanning October to December, shows that Monday’s foot traffic is still down 32 percent from 2019 levels, while Tuesday’s is down 30 percent, Wednesday’s and Thursday’s 28 percent and Friday’s down down 23 percent.

However, from October to December 2022, weekday spending actually increased by 2 percent on Wednesdays and decreased by no more than 8 percent on any other weekday.

Meanwhile, weekends enjoyed both larger attendance and larger spend, with average daily spend of $30.18 million in December 2022, up from $26.25 million at the same time in 2019.

Total spending on Saturdays from October through December in 2022 increased to an average of $35.83 million, a 20 percent increase from 2019, while Sundays are up 11 percent.

Melbourne Mayor Sally Capp said the city had recovered strongly in 2023, pointing to record numbers at the Australia Open, with 839,192 fans passing through the gates during the two-week tournament, down from a previous peak of 812,174 in 2020.

A spokeswoman for the city of Melbourne said the Australian Open had injected $417 million into the city’s economy, a 25 percent increase from 2020, the last time the event was held without COVID-19 changes.

“Our focus for this year is to continue to build on a sustainable recovery to bring our traders and workers predictability and more confidence than ever through key infrastructure projects, events and ongoing investments,” said Ms. Capp.

But Melbourne’s economic recovery is not the same across the city. The eastern part of the CBD saw retail growth of 31 percent in December 2022 compared to December 2019, along with 60 percent growth in hospitality and entertainment.

Retail growth is down 30 percent in the west of the city and 29 percent in the north from 2019 levels, while growth in dining and entertainment is down 11 percent in the west of the city and 21 percent in the north.

Melbourne’s office occupancy rates by November had reached 57 per cent of pre-COVID levels – up from 41 per cent in September – but still lagged behind Sydney (59 per cent), Brisbane (67 per cent), Adelaide (74 per cent) and behind Perth (80 per cent), according to the Property Council of Australia.

Victorian Chamber of Commerce and Industry chief executive Paul Guerra said the return of workers to the city remains the final challenge to Melbourne’s post-pandemic recovery.

“Melbourne is in fairly good health, what we are looking for now is normalizing the return to work,” Mr Guerra told Financial Review.

“We are encouraged by the fact that international students seem to be coming back – they are an important part of our workforce and will help solve widespread staffing issues. Tourism will also get a boost from visiting their families.”

To support continued growth, the City of Melbourne has released a new Guide to Seasonal Economic Activities, providing localized data and insights to support business planning.

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