Website Language
For Sale
For Rent
Auction
Latest Project Highlights
| Rice Miller City Residences | |
|
...
|
| New high-end luxury condominium in Penang island | |
|
|
| Minden Residence | |
|
Minden Residence is located at Gelugor, Penang, comprises 8 units of semi-detached houses and 3 units of...
|
| Moonlight Bay | |
|
|
|
| One One Eight @ Island Plaza | |
|
One One Eight @ Island Plaza A Seamless Style of Living 118 @ Island Plaza takes its cue from the energy, vivacity...
|
| Pearl Regency | |
|
High Living, Sky Living The skybridge. The international activity centre. A 3-story shopping mall....
|
| Fettes Residence | |
|
Fettes Residence Million-Dollar Views Enhance The Priceless Living Experience Let the sea, that stretches across the...
|
| Setia Pearl Island | |
|
Setia Pearl Island - The Island of Dreams Since its debut in early 2007, Setia Pearl Island has established its name...
|
| Seri Tanjung Pinang | |
|
HERE, YOUR LAWN EXTENDS TO WHERE THE SEA MEETS THE SKY. Every home at Seri Tanjung Pinang combines detailed...
|
| The One, Penang Cyber City | |
|
CAPTURING IMAGINATION REALIZING DREAMS Unique, Unequaled and cutting edge, The One is gearing up to be one of the...
|
Email this to a friendMalls, more Malls Everywhere
WITH the opening of 20 malls in the Klang Valley with a total net floor area of 4.4 million sq ft this year, the retail property market is likely to face an oversupply situation with pressure on rental rates, property consultants say.
Many shopping mall projects that were put on hold are back on track, and shoppers can expect to see a plethora of new retail centres on the horizon, especially within the Klang Valley area, comprising Kuala Lumpur, Selangor and Putrajaya.
According to statistics by the National Property Information Centre, as at March 2010, there were currently 49.98 million sq ft of existing retail space within the Klang Valley. Another 7.18 million sq ft is under development and 7.5 million sq ft of new space under planning.
Henry Butcher Retail managing director Tan Hai Hsin believes the new malls that are coming on stream will create an oversupply situation in the market.
Many shopping mall projects that were put on hold are back on track, and shoppers can expect to see a plethora of new retail centres on the horizon, especially within the Klang Valley area, comprising Kuala Lumpur, Selangor and Putrajaya.
According to statistics by the National Property Information Centre, as at March 2010, there were currently 49.98 million sq ft of existing retail space within the Klang Valley. Another 7.18 million sq ft is under development and 7.5 million sq ft of new space under planning.
Henry Butcher Retail managing director Tan Hai Hsin believes the new malls that are coming on stream will create an oversupply situation in the market.
“With the completion of at least 20 retail centres this year, the retail property market share will be squeezed,” Tan says, adding that the negative impact will be focused on certain locations with multiple malls.
“For example, the retail market in Cheras will be even more competitive when at least five new retail centres enter the market this year. In Subang, existing shopping centres are facing more challenges with four new players.”
He says newly-completed shopping centres will face pressure on rental rates.
“There are indeed too many malls within the Klang Valley. Newly-opened shopping centres in the last few years have been facing problems in securing sufficient tenants and shoppers. Many of their problems are due to market saturation, not the financial crisis.”
However, not all new malls will be casualties, even when there are already other existing, established shopping centres within the vicinity, says Malaysian Association for Shopping & Highrise Complex Management member Richard Chan.
“The Wangsa Walk Mall was opened in August last year in Wangsa Maju. Despite several prominent shopping centres (Jusco, Giant and Carrefour) already established within the area, retail space for the new mall (Wangsa Walk) has been fully taken-up,” he says.
A new mall can always be successful if it can meet the needs and wants of customers that were not met by existing shopping centres, he says, adding: “Malls are taken up because of a retail gap that cannot be met by the other malls. If you can fill up this gap, to the point of attracting the crowd from far away areas and meet the demands of the people, it will be a success.”
Chan cites KB Mall in Kota Baru, Kelantan, which is attracting customers from as far as Thailand.
“People from Thailand are going to the mall to get things that they cannot get in their own areas,” he says.
Khong & Jaafar Sdn Bhd managing director Elvin Fernandez believes that the success of potential new shopping centres is dependent on two key factors – their management and locations.
“Mall developers should conduct a study and understand the market before constructing.
Sometimes, they (the developers) will own part of the mall, say 50%, and divest the rest to different parties to manage. When that happens, you lose control,” he says.
“For example, the retail market in Cheras will be even more competitive when at least five new retail centres enter the market this year. In Subang, existing shopping centres are facing more challenges with four new players.”
He says newly-completed shopping centres will face pressure on rental rates.
“There are indeed too many malls within the Klang Valley. Newly-opened shopping centres in the last few years have been facing problems in securing sufficient tenants and shoppers. Many of their problems are due to market saturation, not the financial crisis.”
However, not all new malls will be casualties, even when there are already other existing, established shopping centres within the vicinity, says Malaysian Association for Shopping & Highrise Complex Management member Richard Chan.
“The Wangsa Walk Mall was opened in August last year in Wangsa Maju. Despite several prominent shopping centres (Jusco, Giant and Carrefour) already established within the area, retail space for the new mall (Wangsa Walk) has been fully taken-up,” he says.
A new mall can always be successful if it can meet the needs and wants of customers that were not met by existing shopping centres, he says, adding: “Malls are taken up because of a retail gap that cannot be met by the other malls. If you can fill up this gap, to the point of attracting the crowd from far away areas and meet the demands of the people, it will be a success.”
Chan cites KB Mall in Kota Baru, Kelantan, which is attracting customers from as far as Thailand.
“People from Thailand are going to the mall to get things that they cannot get in their own areas,” he says.
Khong & Jaafar Sdn Bhd managing director Elvin Fernandez believes that the success of potential new shopping centres is dependent on two key factors – their management and locations.
“Mall developers should conduct a study and understand the market before constructing.
Sometimes, they (the developers) will own part of the mall, say 50%, and divest the rest to different parties to manage. When that happens, you lose control,” he says.
Elvin Fernandez feels mall developers should conduct a study and understand the market before constructing. Chan concurs that the number one criteria for the success of a shopping mall is management, rather than location. He says the next most important requirement is “accessibility.”
“The Mid Valley Megamall in Kuala Lumpur is strategically located but would it be successful if it didn’t have all those roads surrounding it? Your shopping centre might be in a good location but it would be pointless if it can’t draw the crowds,” he adds.
Fernandez says rental rates of downtown shopping centres (namely Suria KLCC and Pavilion in Kuala Lumpur) and suburban shopping centres (like Mid Valley in Kuala Lumpur, One Utama and Sunway Pyramid in Selangor) have been holding steady for a while.
Even during the global economic crisis, rates remained fairly steady and we expect them to remain steady for the remainder of 2010, he says, adding that he does not expect a “shoot-up” in rates.
According to Fernandez, rent for average prime space at downtown and suburban shopping centres are currently averaging RM50-RM60 per sq ft and RM30-RM35 per sq ft respectively.
“(Healthy) consumer spending and (good) tourism levels have managed to help keep the (retail) rates up,” he says.
With the improved economic conditions, the outlook for the retail sub-sector in Malaysia seems positive, regardless of the multiple malls, Chan says. “There are more festive holidays in the second half of the year and shopping malls also tend to have sales (in conjunction with the holidays) and year-end sales that will help boost business for the (retail) segment.”
Tan believes that the local retail industry will grow by 5% this year, with total sales turnover expected at RM74.6bil.
“The Mid Valley Megamall in Kuala Lumpur is strategically located but would it be successful if it didn’t have all those roads surrounding it? Your shopping centre might be in a good location but it would be pointless if it can’t draw the crowds,” he adds.
Fernandez says rental rates of downtown shopping centres (namely Suria KLCC and Pavilion in Kuala Lumpur) and suburban shopping centres (like Mid Valley in Kuala Lumpur, One Utama and Sunway Pyramid in Selangor) have been holding steady for a while.
Even during the global economic crisis, rates remained fairly steady and we expect them to remain steady for the remainder of 2010, he says, adding that he does not expect a “shoot-up” in rates.
According to Fernandez, rent for average prime space at downtown and suburban shopping centres are currently averaging RM50-RM60 per sq ft and RM30-RM35 per sq ft respectively.
“(Healthy) consumer spending and (good) tourism levels have managed to help keep the (retail) rates up,” he says.
With the improved economic conditions, the outlook for the retail sub-sector in Malaysia seems positive, regardless of the multiple malls, Chan says. “There are more festive holidays in the second half of the year and shopping malls also tend to have sales (in conjunction with the holidays) and year-end sales that will help boost business for the (retail) segment.”
Tan believes that the local retail industry will grow by 5% this year, with total sales turnover expected at RM74.6bil.
By EUGENE MAHALINGAM
eugenicz@thestar.com.my
Source : The Star, Saturday August 7, 2010