‘Ghost town’: can a new Jam Factory help bring back the buzz to Chapel Street?

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The Jam Factory was once one of the shopping and entertainment drawcards of Chapel Street, a place where retailers would choose to set up their flagship Melbourne stores.

These days, it’s more like an abandoned ghost town. Many of the big brands that once operated there – Georges, Virgin, Topshop, Borders – no longer exist in Australia.

The Jam Factory is nearly completely empty. Credit: Simon Schluter

The Village cinemas are still open, however almost every other business around it has been shuttered as the faded icon awaits a huge $1.5 billion redevelopment that traders hope can help restore Chapel Street’s former glory.

“It’s pretty well dead,” says Rustica owner Brenton Lang, whose South Yarra cafe sits directly opposite the Jam Factory’s front doors.

“Everyone knows where the Jam Factory is, it’s a pretty substantial building. I think this will bring new life to Chapel Street that it has needed for a long time.”

Stonnington Council recently approved a planning permit for 500 Chapel Street – the Jam Factory’s address – which will include 448 apartments, a five-star luxury hotel, retail outlets and office space, as well as high-end restaurants and other entertainment options.

A render of how the Jam Factory will look after the redevelopment.Credit:

As part of the redevelopment, most of the current buildings on the two-hectare site will be demolished, except for the heritage facade and cinema building. The brick chimney at the middle of the complex will be relocated.

It’s not the first time the Jam Factory has been earmarked for an overhaul. This is the third permit since 2018 to be granted to develop the site, however work is yet to begin.

The latest changes to the development will increase the size and volume of the proposed five residential and commercial buildings, and upgrade the hotel, with the largest two towers to be more than 100 metres high.

Sam Koulis thinks the Jam Factory can help bring back the spark to Chapel Street.Credit: Simon Schluter

“It’s very unique [to have] 18,000 square metres of land on what I think is Melbourne’s most important retail strip,” said property developer Tim Gurner, whose company GurnerTM is partnered with Newmark Capital and Qualitas to complete the project.

“It’s an extremely important development to Chapel Street; we know it will be the rebirth.”

Chapel Street is not quite in the dire straits it was just a few years ago. There are fewer empty shops on the famous fashion strip than there were after the pandemic, which led to a downturn in bricks-and-mortar retail.

However, while the 11.3 per cent vacancy rate was better than some of Melbourne’s other retail strips, it was still higher than the street’s 20-year average of 5.5 per cent.

Property developer Tim Gurner is involved in the Jam Factory development.Credit: Michael Quelch

Sam Koulis, owner of the Sam & Ko menswear store, said that people had begun to return to Chapel Street in the past few years, although it wasn’t quite back to where it was when he opened his shop more than two decades ago.

“If the Jam Factory does happen, it’d be unbelievable for the street to get more people to come,” he said.

Carlie Lansdown says Chapel Street needs an upgrade.Credit: Simon Schluter

“Because at the end of the day, it’s still the best street in the country by a country mile. Even though there’s so many shops that are empty, people still come here.”

There were 29 objections to the new Jam Factory plans from residents and businesses, which raised concerns about the height and scale of the development that would lead to issues such as overshadowing and congestion.

However, the application was passed unanimously at a Stonnington council meeting in October, with councillors highlighting the size of the site and its importance in bringing back life to Chapel Street.

Some changes were made as part of the approval to the entries of the building’s car parking and loading bays on Garden Street to improve pedestrian access.

The two-hectare Jam Factory site is one of the biggest in the area.Credit:

“The Jam Factory will be the jewel in the crown of Chapel Street as we move to revitalise this iconic precinct,” said Stonnington Mayor Jami Klisaris.

Menswear retailer Arthur Galan said he was most interested in the redevelopment bringing office workers to Chapel Street, who would shop at times of the week when it’s quiet.

The current Jam Factory was “like a ghost town” when he last walked through, he said.

Arthur Galan says more office workers will help during quiet times of the week. Credit: Simon Schluter

While many people are still working from home after the pandemic, an influx of hybrid workers would still help generate extra buzz, he said.

“There’s a lot of apartments in the area but a bit more office space would be great as it gets people here during the week,” he said. “I think it would be good for the street.”

Carlie Lansdown, owner of SOAK Bar + Beauty, said the new Jam Factory would be fantastic for the precinct.

“There’s a few areas on Chapel Street that need an upgrade and starting with the Jam Factory is going to be great because it’s smack bang in the middle,” she said.

Chasers nightclub owner Martha Tsamis said it was important that the retailers of the new Jam Factory continued the spirit of Chapel Street’s history of supporting younger fashion designers.

“It has to have something that the others don’t have,” she said.

“We don’t need another Just Jeans. It needs people that design other things and different styles of businesses. That’s what people love, trying different things.”

Demolition is expected to begin on the existing Jam Factory site next year.

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