Apple's $50 million bid to build store in Melbourne's Federation Square

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This was published 7 years ago

Apple's $50 million bid to build store in Melbourne's Federation Square

By Simon Johanson
Updated

Apple's decade-long search for a marquee Melbourne store could be about to bear fruit.

The tech giant is believed to be in the final stages of negotiating a deal that will see it open a new $50 million megastore in Melbourne's iconic Federation Square, almost a decade after it first started looking for an appropriate central city site, industry sources say.

Apple has been in lengthy and secretive negotiations with Federation Square's management and the state government to take over and demolish the Yarra building in the square.

The global tech heavyweight plans to replace the unique "deconstructivist" metal building with a new $50 million see-through glass structure that will house its first Asia Pacific stand-alone megastore.

'We are always looking at acquisitions,' says chief executive Tim Cook. 'There's not a size that we would not do.'

'We are always looking at acquisitions,' says chief executive Tim Cook. 'There's not a size that we would not do.' Credit: Mark Lennihan

Apple's plans for Federation Square may prove controversial.

Various buildings in the Square are leased to different businesses, usually to public or cultural organisations in line with the Square's philosophy of being a government-owned public space.

One of the Square's major tenants is public broadcaster SBS, another is ACMI - the Australian Centre for Moving Image.

One of its main drawcards is its giant screen which can beam live events to thousands of watchers.

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Demolishing one of the existing buildings, originally designed by LAB Architecture Studio, is also likely to upset Melbourne's close-knit architecture community.

State tourism and major events minister John Eren would not comment.

Tenants in the Yarra building include the Koorie Heritage Trust, which still has four years to run on a five-year lease, and Italian restaurant Il Pom which runs a busy eatery on the ground floor.

Federation Square's unique postmodern design and paved open spaces were highly controversial when first made public in 1997 after an international design competition.

It has since proved extremely popular as a gathering place for major events, a meeting point for tourists and locals, and has a track record as one of the city's most loved public open spaces.

Apple has unsuccessfully been looking for a shop site in the central city for nearly a decade. Its store requirements are so onerous that few buildings match.

Apple has three existing Melbourne stores, but they are based in Chadstone, Doncaster and Southland shopping centres. None are in the central city shop like its flagship Sydney locations, one in George Street and the other at Bondi Junction.

The company requires at least 1500 to 3000 square metres of floor space for its purpose-built shop fitouts which often cost up to $15 million.

Apple's integrated selling approach with roving sales staff and stands displaying the latest technology must-haves, requires a minimum of 400 sq m of internal space free of any columns. A stand-alone glass structure in such a prominent location would prove a magnet for its customers.

Apple declined to comment. Federation Square chief executive Jonathan Tribe was contacted for comment.

Fed Square Pty Ltd is a company wholly owned by State Trustees Limited as custodian trustee on behalf of the State of Victoria.

Its annual report shows it returned a net profit of $7.2 million to state government coffers in 2016.

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