New Italian restaurants in Sydney

It took a big-budget venue just one year to swap bar snacks for spaghetti. It’s not the only venue making the switch, with some banking on bowls of pasta for under $30.

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Vitelli’s Upstairs is an Italian restaurant that replaced Baptist Street Rec Club in Redfern.Sam Mooy

When Baptist Street Rec Club opened in Redfern’s $500 million Wunderlich Lane precinct last year, it was billed as one of the city’s hottest new bars. One year later, it has been replaced by an Italian restaurant, Vitelli’s Upstairs.

“That’s crazy, right?” said Justin Newton, director of parent company House Made Hospitality. “We only gave [it] about nine months before we made the call to flip it … because margins are so small, we couldn’t afford to take a loss for longer than that.” The interior was made over in just six days.

Baptist Street Rec Club harnessed the nostalgia of 𝄒90s and 𝄒00s Australiana with framed photos of Cathy Freeman and Kylie Minogue, and a cocktail garnished with Tip Top Bread. It was pumping during the weekend, said Newton, but that wasn’t enough to sustain the midweek lull.

Osteria Luna replaced Tiva in December.Steven Woodburn

Vitelli’s Upstairs became the latest in a series of high-profile bars and restaurants to turn Italian in Sydney, including chef-restaurateur Neil Perry’s Double Bay restaurant Gran Torino (formerly Cantonese restaurant Songbird), Etymon hospitality group’s all-day diner Osteria Luna (formerly lounge bar Tiva), and the Captain Cook Hotel in Paddington, which turned its pokies room into Italian restaurant Joe’s Kitchen when it reopened in February.

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“It’s become so expensive to run a hospitality business, in terms of wages and rent and cost of goods, that we don’t have the luxury to go with a niche concept,” said Newton. “Operators have to go with what they know is going to work, and Italian restaurants have proved time and time again that in our cultural zeitgeist, it works.”

Newton pointed to Grana, the Italian restaurant House Made Hospitality opened near Circular Quay in 2021: it’s the highest earner in their 12-venue portfolio, despite little marketing or social media.

Flaminia became an instant hit in Sydney.Sitthixay Ditthavong

Australia’s hospitality sector has the highest failure rate of any industry, according to a 2026 CreditorWatch report that shows more than one in 10 restaurants and cafes collapsed over the past year. During that same time, online reservations platform OpenTable recorded a 38 per cent increase in Italian dining, and more than 30 new Italian restaurants opened in Sydney, including two-hatted restaurant Flaminia and Chris Lucas’ one-hatted Grill Americano, both in the CBD.

“A lot of [operators] are pulling towards it from a cost perspective,” said Etymon hospitality group chief executive Adam Petta. “The margin in pasta is very good.”

Etymon transformed underground lounge bar Tiva into Osteria Luna in December, and it now does 250 covers on a Saturday night. At Captain Cook Hotel, the Italian dishes at Joe’s Kitchen became just as popular as schnitzels and burgers. And Newton said customers were willing to spend more at Vitelli’s Upstairs, where they’ll often add on a chicken parmigiana with their pasta, or a bowl of burrata.

Tiramisu at Bar Allora, which took over the hotel lobby bar at an Accor hotel in the CBD.

Accor’s new in-house food and beverage group Table For partnered with the team behind award-winning CBD cocktail bar Maybe Sammy and the Maybe Frank pizzerias to relaunch their Mantra 2 lobby bar as all-day Italian diner Bar Allora in November. Co-owner Stefano Catino said customers preferred to spend $30 on a pizza than $30 on three tacos at his Mexican bar El Primo Sanchez, in Surry Hills.

“That’s just the price for good tacos in Sydney right now, but three tacos won’t make you feel the same as when you eat a pizza, a bowl of ravioli, or a parmigiana. They’re filling dishes, so with my $30, I’d rather go Italian,” he said.

That’s why chef-restaurateur Paola Toppi is keeping it simple at her new Potts Point restaurant Pasta Shop, which took over from Sonora Mexican in April. Rather than offering the high-end experience her family’s restaurant Machiavelli was known for, her menu doesn’t list anything over $30.

Pasta Shop took over from a Mexican restaurant in Potts Point this month.

“Food costs are out of control, wages are out of control, rents are out of control, and my experience was going, ‘What can I do to stay in this industry and be relevant?’,” Toppi said. The answer was to return to the kitchen and make the pasta herself, to keep prices down.

Italian food has become the “safe” option for diners on a budget, said Sal Senan, who opened Bexley Italian restaurant Sugo in partnership with Huss and Amani Rachid earlier in April.

“In this economic climate, it’s become a treat to go out for dinner, so you want to know you’re going to have a nice, solid meal,” he said. “Everybody loves pizza, everybody eats pasta.”

Sicilian-born pizzaiolo Stefano Scopelliti at Pippo’s Pizzeria e Cucina in Marrickville.

It wasn’t always like that, said pizzaiolo Stefano Scopelliti, who moved from Sicily to Sydney in 1968. He’s the owner-operator at La Coppola in Redfern, and, in October, he partnered with daughter Cassie Scopelliti to open Pippo’s Pizza e Cucina in Marrickville.

“I used to be discriminated against and victimised because of the food I took to school,” he said. “I’d take a bread roll with some salami and mozzarella and the kids would look at me and say, ‘What the heck?’.”

Italian food has existed in Australia since the 1820s, when pasta and parmesan cheese were sold in Sydney warehouses, but the cuisine wasn’t widely understood or accepted until the 1950s, said food historian Dr Tania Cammarano.

The new Italian menu “broadened the appeal” of Captain Cook Hotel in Paddington.

“In the post-war migration boom, all of a sudden, we had lots of Italians coming in, and people say that’s why Italian food became popular,” she said. “That’s part of the reason, but not the whole reason.”

Cammarano said the glamorous image of Italy portrayed during films like Roman Holiday and La Dolce Vita changed the way Anglo-Australians thought about Italian culture, in a way that had little to do with Italian migrants, who continued to face discrimination.

“The glamour is what helped Italian food capture the imagination of mainstream Australia,” she said. The Australian Women’s Weekly published its first spaghetti bolognese recipe in 1952, and it took off from there.

Conchiglie al forno with spicy vodka sauce at Osteria Luna.Steven Woodburn

“Now, we’ve had Italian food in this country for so long that we’re very familiar with it, and it makes sense to me that it would be seen as comfort food,” she said.

Scopelliti opened his first pizzeria in 1988, and over the past 38, years he has witnessed perceptions change and quality improve. Where his first restaurant in Miranda made pizza “the Aussie way, with your average cheese and stuff”, he now makes a specialised pizza dough, fluffy and charred in a wood-fired oven, and he tops it with San Marzano tomatoes and fior di latte cheese.

“It makes me feel proud that Australians have taken on Italian cuisine and they love it,” he said.