'We'll leave happy': Lonsdale Street's first cafe to close

When the lease finishes at the end of June, Lonsdale Street Roasters Number 7 plans to close its doors.

Owner Evan Mannan said it was a bittersweet decision.

"We'll leave happy, we will leave in a good place," he said.

But rising costs and a challenging hospitality environment had made his business unsustainable, he said.

"The market is very tough at the moment and hospitality, especially, is taking the biggest hit," he said.

The original business, Lonsdale Street Roasters, is not closing down, Mr Mannan was quick to point out.

The business sold its cafes some years ago to focus solely on roasting.

Mr Mannan purchased the cafe at 7 Lonsdale Street - the original site of Lonsdale Street Roasters and the first cafe on the street in 2009 - about eight years ago.

It was there, milk crate seating and all, as the street transformed from car yards to hospitality businesses and boutique shops.

Lonsdale Street Roasters Number 7 traded through COVID-19, keeping the doors open even when restrictions limited the cafe to 10 seated customers per hour.

"We've been very happy and we're very blessed to have been in the industry for so many years and going through COVID and lasting for this long," Mr Mannan said.

Since then, as people had shifted to working from home and operating costs had risen, Mr Mannan said the hospitality industry was the "worst it's ever been".

"Unfortunately, the increase in rent, increase in cost of living, increase in our products and suppliers, we're just at a stalemate with it and we just have to ... move on," he said.

Landlord Michael Smith, who also owns the property next door that houses Hopscotch, said rents were rising because his rates and mortgage repayments were rising.

The commercial rates he pays to the government are based on the unimproved value of the site, which has the potential for a six-storey residential building.

"The rents are just about 50 per cent of what we charge on rent," Mr Smith said.

The property investor is also seeking a new tenant for another space in the building, after Lonsdale Street Cyclery relocated to Phillip.

Despite the vacancies, Mr Smith said businesses were still thriving there, like Italian and Sons, which just signed on for at least another 10 years.

He said Lonsdale Street Roasters Number 7 struggled as more people worked from home.

"It needs someone to come in there with a slightly different business model but in saying that I enjoy the best cup of coffee in Canberra there when I go into town," he said.

READ MORE: How decades have changed Braddon's Lonsdale Street

A 'for lease' sign has been hung above the two-level property, with commercial agency K Property leading the campaign.

Leasing executive Jack Hosking said the phone had been "going crazy" with inquiries since the property was listed for rent.

While it's likely a new business will take the cafe's place, there is the option to purchase the business and take over the existing fit-out.

With just two months left on the lease, Mr Mannan said regulars were starting to learn the news.

"I feel like we've made a very big impact in how the street has [been] shaped over the years and we're very proud of it," Mr Mannan said.

"We'll be sad leaving Lonsdale Street."