Developer Marcus Hale Transforms South Melbourne's Clarendon Street With Warehouse Conversions

Marcus Hale signed the lease on his first South Melbourne warehouse conversion in February 2024. Eighteen months later, Southside Collective controls six sites across the suburb's inner grid, has completed two full adaptive reuse projects, and is mid-construction on a $34 million mixed-use precinct on Cecil Street that its backers say will be fully tenanted before the roof goes on. In a local property market where commercial vacancy rates have been stubbornly elevated since 2022, that is not nothing.

The timing of Hale's push matters. South Melbourne's commercial strip along Clarendon Street has been caught between two pressures: ground-floor retail squeezed by foot-traffic shifts after the pandemic, and a chronic shortage of the kind of flexible, mid-size office and creative production space that smaller firms now demand. The gap between those two realities is exactly where Southside Collective has planted its flag.

From Clarendon to Cecil: What the Projects Actually Look Like

The firm's most closely watched project is the former Oram's Printing building on Cecil Street, a two-storey Victorian-era warehouse that sat vacant for four years before Southside Collective acquired it in late 2023. The conversion plan calls for ground-floor retail bays averaging 85 square metres each, three levels of purpose-built creative office space added above the existing structure, and a rooftop terrace accessible to all tenants. Construction started in March 2026 and is scheduled to finish by the second quarter of 2027.

Down the road, the firm's Coventry Street project, a former cold-storage facility near the South Melbourne Market, opened in January 2026 with twelve tenants already signed. Occupants include a boutique architecture studio, a sustainable-materials wholesaler, and a specialist food importer. Effective rents on the office floors reportedly settled around $420 per square metre per annum, a figure consistent with mid-grade creative precincts in comparable inner-city markets globally. The ground-floor retail bays leased at a range understood to be between $1,800 and $2,300 per square metre annually, reflecting the Market's pulling power as a pedestrian anchor.

Southside Collective is not alone in spotting the opportunity. South Melbourne's development pipeline logged more than a dozen adaptive reuse applications with the local planning authority between January and June 2026, according to publicly available planning register data. But the scale and speed of Hale's operation, backed in part by a consortium of South Melbourne-based family offices, has made it the reference point for how the strategy can work at a neighbourhood rather than single-site level.

Why the Model Has Legs Beyond One Firm's Ambition

The broader shift driving all of this is structural, not cyclical. Occupiers across professional services and the creative industries have been renegotiating their footprints since 2022, and many have landed on spaces between 200 and 600 square metres as their target range, too large for serviced office providers to fill economically, too small to attract the big landlords who still dominate the Clarendon Street northern end. Adaptive reuse of smaller legacy industrial buildings fills that gap precisely.

South Melbourne Market itself, which draws roughly 15,000 visitors on a busy Saturday according to figures the Market Trust has previously published, functions as the neighbourhood's clearest foot-traffic engine. Developers and tenants who can position within a short walk of that anchor carry a measurable leasing advantage over sites further out.

For smaller business owners eyeing South Melbourne as a base, the practical calculus is straightforward: watch the Cecil Street and Coventry Street corridors for new inventory coming to market through late 2026 and into 2027. Rents in adaptive reuse buildings are running at a noticeable discount to newly constructed commercial space elsewhere in the inner grid, and lease structures in several of the new conversions are offering shorter initial terms, some as brief as 24 months, to attract tenants unwilling to commit long in an uncertain environment. The window for that kind of flexibility may not stay open for long once vacancy rates tighten further and developers regain leverage. Hale has already said publicly, through Southside Collective's project communications, that two of the firm's next three acquisitions will be in the Emerald Hill precinct. The message to potential tenants is implicit but clear: move now or pay more later.

This article is general information only and is not personal financial or investment advice. Consider your own circumstances and seek licensed professional advice before making financial decisions.