Hotel Chadstone will give retail tenants at the country’s most profitable shopping centre a new way to reach the millions of people who visit the popular Melbourne mall each year, and shoppers a reason to stay – and spend – for longer, Chadstone director Fiona Mackenzie said.

“We’re giving regional Victorians a reason to stay and make a weekend of it, and we think interstate and international people will love it too,” Mackenzie told Inside Retail at the hotel opening last Friday.

“Chadstone is such a significant destination at the moment, you really can’t see it all in a day. [Now you can] enjoy a meal, and make it more of an event.”

Touches of retail throughout

The $130 million five-star hotel is operated by Accor under its MGallery by Sofitel brand and includes 250 rooms, two restaurants, including a rooftop bar and dining area, a rooftop indoor swimming pool, spa and yoga room, ballroom and conference and events space.

The 12-storey building, designed by Bates Smart with interiors designed by DWP, is connected to the nearby shopping centre, known as the “fashion capital” of Australia, via a covered walkway.

In addition to providing shoppers with luxury accommodation and upscale dining options, the hotel also gives the centre’s 550 retail tenants an opportunity to reach shoppers outside their stores.

“We’ll have our first retail partnership in there in a week-and-a-half when Tiffany takes over the lobby, and there are touches of retailers throughout the rooms,” Mackenzie said.

For instance, the rooms all feature a $50 box of beauty products from Mecca, which are available for purchase.

“We think a lot of our global and local retailers will use the hotel for product launches, as sales drivers and for their team functions. It will be very integrated,” she said.

No other destination of its kind

Mackenzie said Chadstone shopping centre, which is jointly owned by property group Vicinity Centres and Australian retail giant John Gandel, is unique in having a five-star hotel on its premises.

“Without a doubt, there’s no other destination of its kind. It continues to raise people perceptions [of shopping centres],” she said.

Chadstone is already the most profitable centre in Australia, turning over $2.2 billion in annual sales and drawing more than 24 million people a year, including more than 500,000 people from overseas.

With developments such as Hotel Chadstone, the centre “just keeps adding layers to the product we sell for our retailers, and hopefully will continue to drive more and more traffic,” Mackenzie said.

According to Mackenzie, Chadstone’s success comes down to its commitment to staying in touch with customers and knowing what to deliver to them.

“We as landlords have to be careful to deliver what the customer wants,” she said.

“We invest heavily into research about customers – how they shop, why they shop, what they want – and make sure we find the retailers that are going to provide that.

“We continue to review and invest in what tenants are best suited to us. That’s a daily proposition to us…that’s what we do.”