Lord Mayor says more office workers needed to give CBD businesses the confidence they need to keep trading  

Lord Mayor Sally Capp has called for a review of the state government’s work-from-home advice as the measure was taking a toll on small businesses in the CBD.

New data from the Property Council of Australia’s latest Office showed Melbourne’s occupancy rate had dropped from 49 per cent to 38 per cent for the month of July.   

By contrast, the figures revealed that other major cities had maintained an average occupancy rate of more than 50 per cent – with Perth leading the charge at 71 per cent.

The Lord Mayor said unless the return-to-office rate improved, business owners were “running out of choices” with many “on their last legs, trying desperately to stay alive”.

After six months of consecutive growth, Melbourne saw its first decline in July, in what Ms Capp described as “a sharp but unsurprising blow that is rattling our city traders”.   

“An indefinite extension of the current work-from-home advice will continue to impede our city’s ongoing bounce-back,” she said in a statement.   

“Victorians know what to do to stay safe and slow the spread. Most Melburnians heed the advice from the state government and our health officials.”   

Council data from early August showed commuter activity at the Flinders St Station underpass during the morning peak hours was down by 54 per cent on the pre-COVID 2019 benchmark.   

At Bourke Street Mall, foot traffic had increased slightly but was down 40 per cent overall on the pre-COVID 2019 benchmark while general pedestrian activity near Town Hall was at 86 per cent of the pre-COVID 2019 benchmark.

The CBD’s Block Arcade manager Grant Cohen backed the Lord Mayor’s call for clarity, saying the current work-from-home advice “doesn’t make sense” as the city was busy on the weekends.  

“The city is pumping on the weekend; the Arcade is packed … there really is an exciting buzz around town on the weekend,” he said.

“It doesn’t make sense they are being told to work from home. If it’s full on the weekends, what’s the problem with having it full during the week?

“People aren’t sitting in solitary confinement at home. They’re still going down to the local café. It would be no different to being in the CBD.”

Tri Lee, manager of the N Lee Bakery Café on Little Collins St, which is located near a government office tower, said business was down 60 per cent of normal trade, and he was desperate for more workers to return to offices. He said without the support of his landlord, he would struggle to survive.

A trader in the city, who asked to remain anonymous, said while they supported the call for more office workers to return, they questioned what help was being given to support retail business owners.

“Every single initiative she [Sally Capp] has brought in has been to support anything that happens after 4pm. From discount parking to food vouchers, to Melbourne Money; everthing is about hospitality and entertainment, nothing is about retail in the CBD,” the trader said.

The Property Council’s acting Victorian executive director Adina Cirson said the latest figures should “serve as a wake-up call to our policy makers and business leaders that we can’t take our foot off the pedal when it comes to CBD recovery”.

“It’s clear from these figures that government advice about working from home, especially internal policies for public service colleagues, has seriously dampened any momentum for a broader return to the office,” she said.

Small Business Australia chief executive Bill Lang told CBD News the state government “continues to show disregard for businesses” and that “clear, direct leadership” was needed.

Victorian Chamber of Commerce and Industry chief executive Paul Guerra said every business and leader had “a role to play and can lead by example”.

“We always knew winter was going to be challenging but now that we’ve passed the peak for COVID-19 and other infections, let’s set a target to get back into the office in a meaningful way from the start of September,” he said.

However, as reported earlier this year by CBD News, Premier Daniel Andrews said while he acknowledged “people are hurting and change is really tough” in relation to the hybrid working model, he conceded, “I don’t think we’re going to go back to the way it was”.

“If you want to keep the CBD vibrant, then maybe we need to have more people living in the CBD,” he said.

Shadow Minister for small business and the recovery of the CBD, David Southwick, said hybrid working may be here to stay “but it’s clear Daniel Andrews’ three-day-a week target for public servants isn’t close to being met”.

At the City of Melbourne’s July 26 meeting, councillors voted unanimously that the Lord Mayor write to the Minister for Industry Support and Recovery, seeking an “accelerated delivery” of the Melbourne City Revitalisation Fund to support the city’s post-COVID recovery.

The letter to the Minister would also ask what efforts were being done to support the return of office-workers back to the city. •