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Malls are big business in KL
Carolyn Hong
Mon, Oct 08, 2007
The Straits Times

The faint smell of construction dust and fine grit was still lingering in the air when thousands of Malaysians rushed to check out Kuala Lumpur's latest glittering mall.

More than 100,000 people, mall officials say, turned up to gawk as the Pavilion opened its doors last Thursday at the posh end of Jalan Bukit Bintang - Kuala Lumpur's version of Singapore's Orchard Road.

The 1.37 million sq ft addition to a neighbourhood that already has at least six other malls has stirred up a buzz on whether there is one mall too many in the city.

The Pavilion has 450 shops, compared to about 350 in Singapore's VivoCity.

The new mall boasts sexy looks, a stylish concept and a string of new shops making their entry into Malaysia for the first time.

But it also joins an extremely crowded field. Kuala Lumpur already has more than 50 malls, quite a few of which are super-sized.

Adding to these are another 40 malls in the neighbouring city of Petaling Jaya.

And more are coming. Two other huge malls will open in the next two weeks, bringing almost 4 million sq ft of new retail space - about four times the size of VivoCity.

Yesterday, the Gardens Galleria, with 800,000 sq ft, opened as an adjunct to the giant Mid Valley Megamall near the hip Bangsar neighbourhood. That brings the whole shopping centre to a whopping 2.5 million sq ft.

After a few days, an 800,000 sq ft extension to the Sunway Pyramid on the outskirts of KL will open, bringing the entire complex to 1.7million sq ft with a total of 800 shops.

"Today, without at least 1 million sq ft, it is hard to create the variety that people demand," said Ms Joyce Yap, president of the Malaysian Association for Shopping and Highrise Complex Management.

About half a dozen malls are already more than 2 million sq ft in size. The biggest is Berjaya Times Square with 3 million sq ft.

The association's adviser, Mr Richard Chan, said a growing segment of shoppers stay more than two hours in a mall. A recent survey showed that this can be as high as half of the shoppers, he said.

The industry is still gungho despite more and more malls competing for the shopping dollar, because of the growing love for shopping in cool comfort and the tourism boom.

Retail sales are expected to grow at least 10 per cent this year, with a total of RM65.5 billion (S$28.9billion) spent on shopping, industry officials said.

The tenant occupancy rate of KL malls now averages 95 per cent, and rentals are still going up.

Ms Yap pointed out that on a per capita basis, Malaysia has fewer malls than Singapore.

While the Republic has at least 20 centres that consistently draw crowds, the same can be said for only a dozen or so KL malls.

Tourism is also one of the fastest-growing sectors in Malaysia, but so far the retail sector has not capitalised on it.
Shopping now accounts for just a little over a quarter of tourist spending.

That is low compared to Singapore's 35 per cent and Hong Kong's 45 per cent.

"The potential is definitely there. Tourist shopping spending has been growing steadily, and there is no limit to how far it can grow," said MrChan.

But with so many malls, the competition is stiff, especially as the differences between them begin to diminish, with all having the same chain retailers and near-identical concept and layout.

Some malls, like Berjaya Times Square, have even built an indoor theme park to be a little different.

The Pavilion is banking on its bright breezy atmosphere, thanks to a giant skylight, and new shops to lure shoppers.

Some 100 shops, or 20 per cent of its tenants, are new to Malaysia, although they are familiar names to those who shop in London or Paris.

These include fashion labels Reiss and Promod and luggage maker Mandarina Duck.

"It is not just about building, another mall, but one that adds something to the shopping scene," said Ms Yap.

 

 
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