A popular bakery chain famous for its iconic sweet treat is to close its doors in Melbourne due to rising business costs.
Black Star Pastry will close its three Melbourne stores (in the CBD, St Kilda and Chadstone) on Sunday.
The restaurant took to social media to say the difficult decision was made because it was no longer feasible to operate the business in Victoria.
“Rising costs, a tough economic climate and industry-wide staff shortages have forced us to consolidate our team and we will be shifting our focus to our original Sydney headquarters,” the post reads.
‘For five years, our team has put their heart, passion and creativity into crafting every cake, pastry and coffee we serve in our stores.’
The company thanked customers for supporting the Melbourne bakery after it first opened at the Prince Hotel in St Kilda in 2019.
The bakery quickly became popular thanks to its world-famous strawberry and watermelon cake.
“We had a wonderful trip and made many great friends here and we hope to see you someday soon,” the post concludes.
Black Star Pastry will close its three stores in Melbourne, St Kilda and Chadstone on Sunday
The measure does not affect its stores in Sydney, which “will continue to operate as normal.”
Black Star Pastry has shops in the city, Newtown, Rosebery and Chatswood.
The company has also opened pop-up stores in Burwood and Broadway.
Black Star Pastry sells over a million slices of its original pastries each year.
The bakery was first founded in Newtown in 2008 by renowned pastry chef Christopher The, who invented the strawberry watermelon cake.
The restaurant soon caught the attention of Louis Li, founder of the Victorian luxury hotel group Jackalope Hotel.
The bakery quickly became popular in Melbourne thanks to its world-famous watermelon and strawberry cake.
Mr Li was so impressed with the cake that he decided to take over the business after becoming a majority shareholder in 2018.
The hotel sector in Australia continues to struggle due to inflation and consecutive interest rate increases.
CreditorWatch, a leading Australian business analyst firm, has predicted that one in 13 hotel businesses will fail in the next year.
The bakery took to social media to reveal the difficult decision it made to close its Melbourne stores because it was no longer feasible to operate the business in Victoria.
CreditorWatch chief executive Patrick Coghlan warned that conditions will get worse for hospitality companies before they get better.
“The outlook for the hotel sector is unlikely to improve until we see an increase in consumer spending,” Coghlan said in a statement.
“That won’t happen until the effects of one or two rate cuts filter down to households. We don’t expect that to be felt until at least the second half of next year.”