Museum of Illusions chooses Collins Arcade for flagship as precinct hits 95 per cent

The new Museum of Illusions opening in George St, Sydney, Australia. (Source: Supplied/Alex Coppel)

By Collins Arcade September 30, 2026

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Collins Arcade has secured another major drawcard, with global experiential attraction Museum of Illusions signing a long-term lease for its first Melbourne location as the destinational CBD precinct reaches 95 per cent leased.

The international brand – which is the largest and fastest-growing private museum chain in the world – will occupy about 1000sqm on level one at 260 Collins Street, with plans to open mid-2027.

With more than 70 locations globally, the Melbourne location will bring its distinctive mix of immersive, interactive and perception-bending experiences to the heart of the CBD, and will be home to up to 80 different illusions for visitors to immerse themselves in.

The Melbourne flagship follows Museum of Illusions’ Australian debut on George Street in Sydney in December 2025, marking the next stage of the global brand’s expansion into the Australian market.

Kim Schaefer, CEO of Museum of Illusions, said: “The response to Museum of Illusions in Sydney has demonstrated just how strongly Australians connect with experiences that are playful, surprising and genuinely interactive. We are thrilled to be opening a second Australian museum in Melbourne, a city celebrated for culture, creativity and discovery.

Collins Arcade’s central location, expansive floorplate and access to strong pedestrian traffic made the precinct a natural fit for the museum. The deal marks another major milestone in the repositioning of Collins Arcade, which opened to the public in October 2025 following a major transformation of the 260 Collins Street centre.

The signing also reflects the strategy of Collins Arcade for Kaipara Property Group and UBS Asset Management, which have sought to create a contemporary CBD destination capable of attracting office workers, residents, tourists and visitors throughout the day and into the evening.

Rather than relying on a conventional retail mix, Collins Arcade has increasingly focused on complementary uses that drive visitation and dwell time – with Museum of Illusions adding another significant experiential anchor to the precinct.

“Collins Arcade continues to go from strength to strength with this deal now completing our leasing strategy for the larger spaces,” said Kaipara joint MD Toby Daniel.

“We’ve deliberately curated a mix that gives people more reasons to come into the centre and stay longer, and the arrival of an international attraction like Museum of Illusions builds on that strategy.

“Collins Arcade brings together fashion, unique entertainment, food, wellness and creative workspace in one destination.”

Museum of Illusions joins a growing roster of brands now open at Collins Arcade, including Swatch, Birkenstock, Tommy Hilfiger, MJ Bale, Mimco, Politix, Saba, Kathmandu, 2XU and Trenery, alongside Melbourne hospitality operators Le Yeahllow and Attakai Garden, with entertainment group Kingpin occupying the entire lower ground floor.

Priceline Pharmacy anchors the precinct’s health and wellness offer on level one alongside operators including Yuki House, The Lounge Beauty, Lazer Erazer, D&Y Hair and Dorevitch Pathology.

The leasing program, led by Zelman Ainsworth of Ainsworth Property, has helped reposition the former retail centre into a more diversified destination and provides a case study in how established CBD assets can evolve in response to changing consumer behaviour.

Return-to-office trends, tourism, major events and infrastructure investment continue to support demand for well-positioned CBD retail.

Against that backdrop, Collins Arcade reaching 95 per cent leased within its first year of operation represents an important milestone for the asset.

“With the ground floor arcade now fully leased and only a couple of remaining tenancies on Level 1, our focus now switches to driving continued success for our tenants and cementing Collins Arcade as the leading retail and experience destination of Collins Street,” said Daniel.

“We’re extremely pleased with the response to the precinct and the calibre and diversity of operators it has attracted. Museum of Illusions is another major piece of that story, and we’re looking forward to seeing the next phase of Collins Arcade take shape with their opening next year.”

Museum of Illusions is scheduled to open at Collins Arcade in mid-2027. And stay tuned for another exciting announcement for Collins Arcade in the coming months.