RETAIL in some areas of Melbourne's central business district is collapsing, with more than a dozen empty stores at the retail fashion precinct attached to Southern Cross Station. The centre - formerly DFO and now Spencer Street Fashion Station - is littered with closed stores, including Country Road, Witchery, Pilgrim, Charcoal and Barkins.

At Docklands, some businesses are not paying rates to help keep them afloat.

Lord mayor Robert Doyle said he was concerned about the retail environment, particularly in Docklands.

''It's tough, it's really tough,'' he said. ''Retail is tough enough in the city … here in Docklands, particularly down where the wheel [the Southern Star Observation Wheel, which is being rebuilt] is, where retailers were hoping that wheel would be a magnet, makes it really tough for them.''