Mall retailers keen to expand, but cautious

RETAILERS still want to expand their businesses despite the challenging economic outlook this year, said a property consultant.

"They are cautious, but are pursuing expansion. The main concern is whether the (mall) developer has the capability to complete the project," DTZ Nawawi Tie Leung Property Consultants senior director Adzman Shah Mohd Ariffin said.

DTZ has been appointed the leasing agent and retail mall manager by Pramerica's Asian Retail Mall Fund (ARMF), the investor of four malls managed by DTZ.

The malls are SSTwo and Ampang in the Klang Valley and two malls in Penang, 1st Avenue and Island Plaza, which are currently undergoing refurbishment. All four malls offer a total net lettable area of about 1.8 million sq ft.
ARMF is an investment arm of US-based Prudential Financial Inc. As at June 30 2008, it has managed US$5.1 billion (RM18.21 billion) of group assets throughout Asia.

"Retailers are well prepared to expand despite the economic downturn. They want fresh loca-tions, which is the advantage we have with the four malls. So far, during our roadshow, we have received overwhelming response," he said in an interview recently.

Malls today are no longer just a shopping destination. The upcoming malls are adopting the edutainment and entertainment features by offering a wide variety of eatery outlets, karaoke centre, cinema and bowling alley, among others.

"This trend encourages people to spend a much longer time in the mall and browse around the shopping area," said Adzman.

"Edutainment and entertainment-trend malls attract shoppers from all walks of life. Thus, it's crucial for us to ensure the setting offers the right mix of products at every corner of the building."

SSTwo and Ampang are located within a residential and commercial area. Aimed at upper and middle class families and those with children under the age of 12, the malls offer 462,800 sq ft and 580,000 sq ft of nett lettable area, respectively.

Targeted to open by the fourth quarter of this year, SSTwo offers a dedicated kid's loft with children's fashion and toys and maternity goods in addition to other merchandise. Ampang key anchor tenants, meanwhile, include a department store, hypermarket and cineplex. The mall will be ready in the first quarter 2011.

The 1st Avenue mall in Penang offers 428,000 sq ft of nett lettable area with a dedicated youth level. The mall should be completed by fourth quarter this year. Its main target markets are young adults aged between 20 and 35 years old and middle to upper middle class professionals.

Established in 1996, the Island Plaza has an occupancy rate of about 70 per cent with Metrojaya and Cold Storage as anchor tenants. Since Penang draws huge tourist arrivals with many expatriates, Adzman said, both malls in Penang hope to cater to this market.

By Business Times (by Zurinna Raja Adam)