Spanning an entire block from Lygon Street, the caffeine and cake empire, run by the Angele family since 1991, will open a 160-seat Italian restaurant with two private dining rooms, a 40-seat wine bar with terrace overlooking Drummond Street, and a 60-seat coffee bar/lounge with dessert bar that will introduce high-end tea.

Brunetti co-owner Yuri Angele said the business was renowned for coffee and cakes, but he wanted to expand the brand in 2016 in an empty 1100-square metre space at the back of the building. "We've surveyed a lot of people and they don't make the connection between Brunetti and savoury food," Mr Angele said.

"We felt that we would rebrand the back with another name and style it with a 1960s warm and rustic feel. By giving it a new identity, people will connect to the concept a lot better."

The lustrous cakes and shiny terrazzo floor at the Lygon Street end will be complemented by a new coffee bar where Brunetti will turn to micro-roasting and introduce six new blends to the existing two. The business already pumps out 28,000 coffees a week from 6am but is gearing up to give coffee snobs even more choice.

Melbourne's insatiable demand for espressos, lattes and their frothy counterparts is part of a national $4.3 billion industry with annual growth of 3.2 per cent. A report on cafes and coffee shops by business information analysts IBISWorld says 6701 businesses employ 86,243 people to deliver what customers consider an "affordable luxury" and daily ritual.

Famished Melburnians are forced to queue for prized seats around town but enough of that: Brunetti's new a la carte and pizza restaurant with open kitchen will take bookings. Sugar fiends know the crisp crunch of cannoli but with Brunetti's new dessert bar, it will be a "dessert experience". The wine bar will sell "very affordable" drops by the glass and that's worth a toast. "We really want to make it affordable and drive the antipasti and enoteca offering," Mr Angele said.

Thousands of coffee cups and wine glasses will have to be shipped into Lygon Street because the Valmorbida​ family's redeveloped King & Godfree​ will reopen later this year with a new deli, espresso bar, retail/grocery section and gastronomia. There will be a restaurant behind the deli and the conviviality continues next door with a wine bar, cellar and retail store.

In this hip but not hipster end of Lygon Street, you will struggle to find a red gingham tablecloth masking spaghetti-sauce stains, menus in sticky plastic folders or an over-enthusiastic spruiker. It's the "safe zone" immune from the Little Italy stereotype illuminated by a candle in a raffia chianti bottle.

Fortune favours Lygon Street because it only has a few empty shops and does not suffer the high vacancy rates of other strip shopping centres such as Bridge Road, Richmond, where 30 per cent of stores are empty. The head of retail leasing in Melbourne for CBRE, Zelman Ainsworth, said hospitality businesses such as Brunetti have made Lygon Street "one the most iconic retail strips" in Australia.

"Retailers have always been attracted to Lygon Street due to the close proximity to CBD, the high-income earners in Carlton and Collingwood, and the strong Italian heritage that supports alfresco and evening dining," Mr Ainsworth said.

The Angele family is fine-tuning plans for Brunetti's expansion into a 600-seat venue and may lodge them with the Melbourne City Council at the end of the year. Construction could begin April in 2016 with a possible opening in November 2016.

A travelator would come in handy to get from one end of the Italian food mecca to the other.