Welcome to Setting Up Shop, a series in which we take you around the world to the most dynamic and emerging luxury shopping hubs, introduce you to the customers, and get an understanding of what makes the local market tick.
If you want to set up shop Down Under, your first stop should be Sydney.
Often mistaken for Australia’s capital (it’s not — that’s Canberra — decidedly not a luxury hotspot), Sydney is the country’s most recognisable destination. And it’s a “strategic city” for luxury brands looking to enter Australia, according to real estate firm CBRE.
“It will always be Sydney,” says Tim Starling, founder of Starling Retail Advisory. “It’s the 12th biggest financial hub in the world. It’s got the bridge. It’s got the Opera House. It’s got the largest population — and it’s got the most spend.”
2024 saw big names from Dior to Bottega Veneta opening new stores. Others, like Louis Vuitton, majorly expanded their footprints with larger flagship spaces.
“There are more brands coming,” says consumer Effy Kios, who lives in South Sydney and has just walked out of the Dior store with a new pair of shoes. She spent June and July in Europe, and is hopeful that brands will bring the full product mix they have overseas to Sydney. It’s changing already, she says. “There is that demand here. It has to be catered for everybody — the high end, the not-so-high end, the in-between. And we see that. There is a lot of fashion coming out here to cater for everybody.”
There’s a deep market for ultra-luxury in Sydney, says Sameer Chopra, head of research for Asia-Pacific at CBRE. In 2024, it was ranked the eighth wealthiest city in the world by number of millionaires, up from 10th the year prior. The Australian average income is expected to increase 18 per cent by 2033 to AU $132,000, up from its current AU $96,000, increasing the spending power of Australians, according to CBRE. An 18 per cent increase in employment and 15 per cent population growth will also drive spending upwards. Brands would be smart to establish themselves in the region before this ‘triple boost’ kicks into gear.
“The wealthy continue to remain in Sydney, and it’s a much more consistent performer [than the rest of Australia],” Chopra says. Even now, over 35 per cent of people who immigrate to Australia land and stay in Sydney, CBRE finds. (This is higher than all other Australian cities.) “Sydney is number one,” he says.
Brands are keen to capture those touching down. In 2022, Terminal 1 at Sydney’s international airport underwent a major revamp, followed by a second phase of luxury openings in 2023. Brands like Balenciaga, Bottega Veneta and Hermès opened up shop, ready to greet tourists arriving in Aus. Terminal 1 was Burberry’s first Australia outpost to debut the brand’s (then) new global store concept.
For jewellery brand Mejuri, Sydney is where most Australian consumers are located. “Our approach to location and neighbourhood selection is heavily data-driven, but ultimately, it is where our community resides,” says Mejuri president and COO Majed Masad. “We incorporate internal sales (both e-commerce and retail) and customer data, paired with socioeconomic data to help guide us in our location selection.” Sydney was the brand’s first stop, but there are plans for more Aussie openings in the next few years, he adds.
Anine Bing took the same approach: Sydney and Melbourne were the brand’s two largest Australian markets, so it started with Sydney, and Melbourne soon followed.
Sydney may be the go-to first stop for brands looking to establish an Aussie footprint, but the city’s makeup poses tricky for location scouting. “Sydney’s interesting in that retail is kind of hard in the sense of ‘where do you go to shop?’” says Australian native Christopher Esber, who opened his first physical pop-up in Sydney in December 2024. (It’s open until March.) Like many of his predecessors, he opted for a nook in Sydney’s central business district (CBD).
In an increasingly crowded city, where can brands go to stand out? Here’s what you need to know before setting up shop in Sydney:
The lowdown
Sydney’s CBD is a tried-and-true centre for luxury. Many stores are located in the Westfield mall, which, in 2024, underwent a major expansion. It’s less about the mall itself, though, and more about the prime street-facing positions a Westfield store affords brands, Starling says. “In Sydney CBD, brands want a flagship street store. It just coincides that Westfield Sydney fronts onto the street,” he says.
It’s clear to see why. In 2023, the total retail spend in Westfield Sydney’s total trade area was estimated at $83.8 billion, while the total retail spend in the main trade area (which sees the highest traffic) was estimated to be $34 billion. Westfield Sydney’s main trade area has a high retail spend per capita of $17,531, which is 14 per cent above the wider average of Sydney’s metropolitan area ($15,426). It’s home to the largest proportion of fashion retailers than all other Westfield centres in Australia.
Beyond Westfield, though, there are opportunities. Sydney’s centre is filled with small arcades, which house clusters of shops. Mejuri opted for The Galeries, also home to Ganni and Australian multi-brand boutique Incu. “The mall environment at The Galeries is an exciting one for us. It gives us an opportunity to expose the brand to a broad customer base with an intent to purchase, which in many cases is more than high streets,” Masad says. “After testing the market with a short-form pop-up with [now neighbour] Incu in 2023, we confirmed the potential at this shopping destination.” With over 25 million customers flowing through the transit hub every year, Masad is optimistic about the brand’s exposure in this space.
Aussie-born Esber also opted for an arcade location. “I didn’t want to be in a centre originally,” he says. He’d hoped for a street-facing window. Then, the Strand Arcade space came up. “Even though it’s within an arcade, it still has this beautiful heritage, and there’s something quite charming about the space,” he says. “I thought it was a nice way in.”
The crowd is interesting, Esber says, because the CBD draws a more corporate and destination shopper than other more laid-back Sydney areas. “The fashion girlies are coming in, and those who know the brand and want to be able to try it on,” he says. “It’s also been someone who’s really busy, has an intense job and would just come in on a lunch break and sort some things out.”
One obstacle to setting up shop in the CBD is the limited real estate, experts flag. “There’s a little bit of a shortage of prime location,” says Gennaro Autore, founder of retail consultancy Graaf Group, which has worked with international stores including Brunello Cucinelli and Missoni to open in CBD’s Martin Place. Autore credits these deals to the fact that they were done during Covid, when brands didn’t want to risk opening. Now, he says, it’s flipped – so many brands are opening that prices are high, and available retail space is few and far between.
Australian luxury brands are a good indicator of where international labels should be looking outside of the city centre, especially as they open more stores in the city.
Take Zimmermann, now an international label in its own right, which owns spaces in Bondi Junction and Paddington as well as the CBD.
Paddington is the choice for labels hoping to capture Sydney’s fashion crowd. It’s heavy on homegrown labels (many of whom, like Zimmermann and Scanlan Theodore, have found global success), which are now joined by international exports like Sweden’s Acne Studios, New Zealand’s Maggie Marilyn and Los Angeles’s Anine Bing. Multi-brand retailer Parlour X also brings international labels like Dries Van Noten, Bottega Veneta and Phoebe Philo into the mix.
For Anine Bing, Paddington was a no-brainer. “Five Ways [in Paddington] really encapsulated what Anine Bing is about, which is boutiques, amazing coffee shops, incredible lifestyle, great restaurants — the perfect neighbourhood destination,” says global brand president Julie Bourgeois. “It was really important for us to be close to this local clientele.” From e-commerce and wholesale data, they knew their consumers were there.
Lots of local shoppers do indeed come in, says Amy Finlayson, area manager at the brand’s Sydney store. “We have a really loyal regular local customer, you know, those women that know that we’re here that come back and will buy those favourite items in a different colour every season,” she says.
St Agni, which opened its first Sydney store in Paddington in early 2024, opened its second Sydney outpost in Bondi Beach in November 2024. The stock varies based on location, says manager of the Bondi store, Emily Hesson. “Paddington speaks to a consumer that lives closer to the city, where this is more our beach, resortwear type of customer,” she says.
These areas grab tourists keen to escape the hustle and bustle of the CBD. “[In Bondi], the tourism aspect helps in reaching new customers and introducing them to the brand,” Hesson says. Those who have scoped out the beach often wander the shops afterwards. Paddington, too, sees its fair share. Post-Covid, people are travelling, Anine Bing’s Finlayson says. “We’ve had a lot of New Zealand customers recently, actually, a lot of international customers. I had a Brazilian couple in yesterday. People are definitely travelling.”
These days, international and luxury offerings tend to concentrate in the Eastern Suburbs (some of the city’s most affluent areas). But developers are confident that they can draw brands to newer locations. The logic is that, by offering direct lines to consumers located in Sydney’s West, North or South, brands will be able to connect in person with shoppers who may not otherwise want to venture into Sydney’s CBD.
The demand is there: surfer Laura Enever and DJ Jake Smith live in Sydney’s Northern Beaches, but drove 45 minutes to shop in Paddington. Their plan was to head to Bondi Beach, then the city. It’s a common trek for non-Eastsiders.
Because of this, experts expect that one of Sydney’s next retail hotspots will emerge in Parramatta, which is in the city’s West. Over the last decade, the area has seen major growth — and has generated big investment. “There’s a lot of wealth in Western Sydney,” CBRE’s Chopra says. “When it wants to shop luxury, it will come into the city. Parramatta needs to build that experience.” Northern Sydney is another area experts believe has the potential to rise in retail. Like the Eastern Suburbs, the Northern Beaches is another of Sydney’s most affluent pockets. Shopping centre Chatswood Chase is set to undergo a redevelopment after shopping mall landlord Vicinity bought back the stake it sold in the mall a year prior (for 45 per cent less).
Rather than North or West, developer Goodman is banking on its South Sydney new retail precinct, Rosebery Engine Yards. “South Sydney is undergoing significant growth, with Rosebery becoming a vibrant hub for professionals, families and creatives,” says David Wilson, general manager of commercial at Goodman. Wilson contextualises the area as an alternative to high streets and malls alike: “A destination that offers the charm of Paddington but with modern amenities, parking and a cohesive retail environment under one roof.”
Full-blown retail wasn’t always the plan. During construction, demand for commercial office space was lower than anticipated (post-Covid), but interest in showroom and retail space was significant, Wilson says. So Goodman pivoted, and the area is now home to stores including Zimmermann, Aje and Rebecca Vallance. So far, Estée Lauder is the only international participant, but the plan is to attract more international luxury brands looking to connect with local Sydney consumers, Wilson adds.
Meet the shoppers
University students Melen and Kevin, both of whom are from China, have just come from Louis Vuitton where Melen bought a bag. They live in the Northern Beaches, and usually go shopping in the city. Since arriving in Sydney three to four years prior, it’s changed, they say. “It’s more expensive,” Melen says. Kevin agrees, adding that prices and cost of living are “going high”. On the flip side, he feels there’s more choice than when they first arrived. “This year, we could find many new brands,” Kevin says. “Especially since some American brands like Skims are now in David Jones, so we can try it.”
Goodwin’s two daughters are in town to attend the evening’s Chanel event at the Australian ballet with their mother. Stroud, a photographer, and Hawes, an interior designer, are both Canberra-based but spend time in Sydney often — for work and to see family. Their favourite places to shop? “We should say Chanel!” Goodwin says. “I always love Acne,” Hawes adds, nodding at the Acne Paddington store across the way. Goodwin is based in the city, so the trio also shop around there.
Enever and Smith are based in the Northern Beaches, but came down to do some shopping on Smith’s day off (Enever is a surfer). “We have a big New Year’s Eve party, so we’re coming to shop for that,” Enever says. They plan to hit their usual areas. “We always go to Paddington, Bondi Beach, Westfield in Sydney [CBD]. We just kind of do the rounds of the three little zones,” she says. The New Year’s party, as happens, was their wedding reception, and Enever is debating a pair of white Prada heels in the city.
Gray lives in Newcastle, but is in town working from her office on Macquarie Street in the CBD. It’s a short walk from Louis Vuitton, where she just bought herself two handbags. When she comes to town, she shops in the CBD. “There’s a bit more variety,” she says. “There are a lot more newer shops coming into it.”
Joan and Megan are both used to shopping online. “I scroll a lot,” Megan says. So they’re happy that stores like Réalisation are opening physical spaces in Sydney — especially since they’re in areas like Paddington, versus malls. “When I was younger I would have gone to a Westfield,” she says. “This is more of an experience: you’re on a nice street, it’s pretty, you can go into a shop and try things. It’s a win for international brands, Joan adds. She usually online shops from Aussie brands because of sizing uncertainties and complicated returns, so being able to shop IRL is a major plus.
Kelly, who works for charity Thread Together, is shopping for Christmas presents, while keeping an eye out for Christmas and New Year’s Eve outfits. I ask about her Loewe shopping bag. “It looks pretty fancy, but do you know what it is? A diffuser. It’s the Tomato Leaves [scent],” she says. “I wish it was a handbag for me!” When shopping, Kelly usually heads to the city, though she lives in Mosman on Sydney’s Lower North Shore, which she says is starting to get “a few better shops”.
The Sydney-based pair are out shopping for Christmas presents, and Silvana is on the lookout for something to wear on Christmas Day. They usually shop around Bondi Beach, sometimes Bondi Junction (where Westfield, home to many more luxury stores, is located). “I love a trip to the city, but it’s just more effort,” Silvana says. Paul is along for the ride. “I don’t mind, but, you know, I’m not very fashionable,” he says.
Kios, who lives just south of Sydney, is having a day out in the city. She bought herself a pair of shoes from Dior. “I prefer to come to the city,” she says. “There’s a bit more variety here, and it’s easier to get into — I train in, so I just get off at St James and wander around, instead of the trying-to-find-parking nightmare.” She sometimes heads in if she has a function she needs an outfit for; other times, it’s just to browse. “If something catches your eye and you have to have it, you have to have it,” she says.
City quirks
Sydney-siders, as a rule, don’t like to repeat event outfits, locals say. “While Sydney is a more casual city, people love the opportunity to get dressed up, and there’s always something happening,” says Emma Gott, founder of consultancy Emma Gott Creative. “Sydney-siders don’t need much of an excuse to buy a new outfit.” It’s why Réalisation Par rushed to open in December 2024. “December is definitely our peak — people are shopping for their Christmas dresses, their New Year’s outfits,” says Elke Long, head of partnerships and collaborations at Réalisation Par, who spent the brand’s opening months in Sydney to aid the transition.
Sydney is relaxed (like Setting up Shop destination, Austin, before it). “In Sydney, we’re pretty laid back, but we also want to look good,” Anine Bing’s Finlayson says. “You wanna be comfortable and look good and look like you’ve made this crazy effort — and still be super chill. [Anine Bing] just resonates well with our customer here.” Gott echoes this sentiment, contrasting Sydney style with a more refined Melbourne look. “While Melbourne tends to favour a sleek, polished aesthetic, Sydney consumers gravitate towards a polished-yet-effortless vibe,” she says. “They are quick to adopt trends but often reinterpret them through a local lens, incorporating a sun-kissed, relaxed twist.”
The bikini tops of Bondi didn’t make it to Paddington, but the flip flops (or thongs, as they’re called in Aus) did. This is a uniquely Sydney quirk, Gott says, adding that it’s normal for people to head to dinner straight from the beach, or straight to the beach from the office. “The relaxed attitude even extends to fine dining; I’ve seen people wearing thongs at upscale restaurants, which I don’t think would be acceptable anywhere else in the world.”
“You get another peak in May, June, before everyone goes to Europe,” Gott says. “I know it’s a bit like it everywhere, but especially here, you’re going into winter, but so many people who are shopping here are about to go to Italy or wherever. We’ve had people come in specifically for that,” Finlayson adds. So the Anine Bing store is always prepped with cross-seasonal stock. “If my VIPs are going away during our summer and they’re going skiing, we’ll have something for them,” she says. “And if, during our winter, they’re going to Europe, we’ve always got a little selection of swim or some beautiful seasonal summer offerings.”
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Place your bets
Australia may be a trek for brands, but it’s worth the investment. And Sydney is the best bet for a proof of concept. Almost 60 per cent of orders in Mejuri’s Sydney store are coming from customers who are new to the brand, Masad says — despite it being “miles and miles away” from Mejuri’s Toronto HQ. “Sydney has validated that there’s an opportunity for Mejuri to continue to expand the brand in the Australian market,” he says.
Sydney remains the go-to for labels wanting to reach consumers across Australia. “Sydney will remain the gateway,” says Kate Bailey, head of retail and alternatives research at CBRE. “Brands test the brand there, what works, what doesn’t.” Then, they move to Melbourne, then Brisbane and beyond. “At the moment, brands are a little bit risk-averse. They’re feeling out what their spending climate looks like. That’s going to remain the same for the next couple of years: brands don’t want to take too many risks and Sydney’s a pretty safe option.”
Sydney is a good bar, brands agree. “We knew we were ready to expand our Australia distribution as soon as Sydney opened and we saw the response,” says Anine Bing’s Bourgeois.
Local consumers, for their part, are keen for the Sydney ascent to continue — irrespective of brands’ wider plans for Aussie growth. As Sydney shopper Kios asks: “Why should we miss out?”
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