Tag Archives: Retail Space

Positive signs for ION

With half its shopping space snapped up, it is on track to reach target for launch

RETAILERS have already bagged 50 per cent of shopping space at ION Orchard, a highly-anticipated development slated to open beside Orchard MRT station next year.

As for the remaining half of the 663,000 square foot of new retail space, landlord Orchard Turn Developments says it is “in negotiations”.

Secured tenants include Marc Jacobs, Fossil and Armani Xchange.

“In full recognition of our excellent location and landmark status, we are pleased to say that more than 30 per cent of retailers who have signed up will be setting up their flagships at ION Orchard,” said Ms Soon Su Lin, chief executive of Orchard Turn, which is a joint venture between Singapore’s CapitaLand and Hong Kong’s Sun Hung Kai Properties.

This includes popular brands such as Max Mara and Topshop and Topman, which will relocate two of its existing stores at Wisma Atria and Isetan Scotts to the new shopping mall.

ION Orchard has previously announced that Louis Vuitton, Cartier, Prada, Christian Dior, Dolce and Gabbana and Giorgio Armani as the six mega brands that will front its two-storey duplex stores.

The mall, which sits at the junction between Orchard and Paterson Roads, has also clinched 45 new-to-market brands and newly-created concept stores by established operators, said Ms Soon yesterday.

“With less than a year to go until our opening, we are definitely on track to achieving our target,” she added, referring to an aim to lease 60 per cent of the space to flagship shops, new brands and concept stores.

As a show of an ongoing commitment to integrate art into the shopping experience, the mall will feature sculptures and media installations. There will also be a 5,600-square-feet art gallery in the complex.

To attract more quality tenants, the mall yesterday unveiled a first-of-its kind retail showroom that promises to reflect the “multi-sensory experience, spatial quality and positioning” that it aspires to offer visitors.

The 8,000-square-feet showroom features LED floor-to-ceiling panels and specially-produced videos introducing visitors to the ION Orchard brand.

Source : Today – 23 Jul 2008

Will landlords face a possible over-supply?

3 new malls, 5 million sq ft

SHOPAHOLICS can look forward to a fresh injection of 5 million sq ft of new retail space by the end of next year, according to Knight Frank’s calculations.

By then, at least three big new malls are projected to be ready to welcome shoppers: West Coast Plaza, Illuma and ION Orchard.

However, while customers rejoice over larger and more novel malls, will retailers and landlords face a possible over-supply?

Probably not, says Mr :Nicholas Mak, director of research and consultancy at Knight Frank, despite up to 60 per cent of this new supply being in the centre of the city.

“Pent-up demand for retail space in the area, brought about by government initiatives to boost tourism, such as the inaugural Formula One night race, is likely to absorb most of the on-coming supply,” said Mr Mak.

It has been more than a decade since a new mall has appeared in the premier Orchard Road shopping area.CapitaLand and Sun Hung Kai Properties’ ION Orchard will provide 663,000 sq ft of prime retail space on Orchard Turn. Work is also underway on the nearby 313@Somerset. Both should help rejuvenate the area.

Compared to Hong Kong, Mr Mak believes Singapore, :based on its current population, has room to expand its retail stock further.

Tourism figures have been robust, with 10.3 million visitors and $13 billion spent last year. And despite global economic woes, 4.26 million visitors came to Singapore in the first five months of this year, up 4.3 per cent year-on-year.

“With a fast-rising population, coupled with strong visitor arrivals, growth in retail space is imperative to sustain the quality of the shopping experience,” said Mr Mak.

Nominal retail sales are anticipated to rise from $650.60 per sq ft (psf) last year to almost $700 psf in 2010, according to Knight Frank.

“Therefore, this potential new supply in the retail sector will be positive news for both retailers and consumers,” saidMr Mak. “Retailers can look forward to choice shop space and higher retail sales psf, while consumers can expect a more exciting retail scene coming their way.”

In Bugis, six-storey Illuma shopping mall is almost completed, with Jack Investments billing it as an “urban entertainment centre”.

West Coast Plaza is slated to open before the end of this year and is being billed as “An Oasis in the West” by developer Far East Organisation. This follows the revamp and renaming of the 16-year-old Ginza Plaza.

Beyond next year, the largest retail development currently planned is Marina Bay Shoppes by Marina Bay Sands. This is part of the integrated resort project and will provide 800,000 sq ft of waterside shopping space.

CB Richard Ellis estimates a total6.9 million sq ft of retail space will come on stream by 2012, albeit mostly next year.

Source : Today – 9 Jul 2008

New Changi Business Park site may see bids of up to S$600m

JTC Corporation on Wednesday launched a tender for a mega development site at Changi Business Park, and the 4.7-hectare site is likely to see bids as high as S$600 million.

The winning bidder will have to build an integrated development comprising a business park, retail activities and a hotel.

Changi Business Park has been a hub for businesses that need to stay close to the airport or away from the city centre.

The new site being launched by JTC is at the junction of Changi South Avenues 1 and 2.

The site will yield a total gross floor area of 117,515 square metres, and 60 per cent of the floor space must be used for business park activities. The rest has been set aside for so-called “white” or commercial activities, including retail and hotel space.

Developers can dedicate 45 to 60 per cent within the “white” component to retail activities, with the remaining being set aside for the development of a hotel.

Observers say the winning bidder will need to build a hotel on the site to ease the crunch on hotel rooms in the vicinity.

Chua Yang Liang, head of research and consultancy at Jones Lang LaSalle, said: “I would say the retail component is going to be more limited to just serving the day-to-day needs of the immediate occupants there. Hotel, on the other hand, is probably more welcomed. There is a dearth of hotels in and around that area.”

Some 2,000 hotel rooms could be built on the site, according to analysts that Channel NewsAsia spoke to.

The news comes as the government tries to cater to the rising demand for business park space and amenities in that area.

JTC expects Changi Business Park’s current population of 6,000 to surge to 20,000 by 2011.

Market watchers say demand will continue to remain strong over the next 12 to 24 months.

Donald Han, managing director of Cushman & Wakefield, said as long as there is a huge gap between the prime office rentals in the central business district and the rentals in Changi Business Park, “there will be what we call the preference for huge multi-national corporations to try and average down CBD office rents by moving part of their operations into the Changi Business Park.”

Interested bidders have up till 19 August to submit their proposals for the site. – CNA/ac

Source : Channel NewsAsia – 11 Jun 2008

SMRT opens first non-underground retail space in Choa Chu Kang

SMRT has officially opened its first heartland, non-underground retail space – Choa Chu Kang Xchange, at the junction of a bus interchange, MRT and LRT stations.

This follows the Raffles and Dhoby Xchanges, both of which are in the city.

Covering close to 1,000 square metres, all 42 shops at Choa Chu Kang Xchange have been leased out.

MRT Corporation president & CEO, Saw Phaik Hwa, said: “(Five years ago) when we started off for only retail, we used to… make about S$20 million in terms of rentals. Today, I think this year, we should end in excess of S$40 million. So, it’s more than doubled in terms of revenue from rentals alone.”

Despite some recent problems with tenants at the Dhoby Xchange, who felt they were not getting enough exposure, SMRT said things have since turned around there, and there are now many new tenants and the occupancy rate has hit over 90 per cent.

SMRT said retail space in the heartlands does not necessarily mean lower rentals.

Mr Saw said: “It is not location. It is the passengers that you bring to the location. So we have tens of thousands, sometimes 100,000 passengers, in certain exchanges like Boon Lay, (which) is very highly used. Here (Choa Chu Kang) is very highly used.”

Some shops at the Xchange have been able to balance off higher rentals with higher profits, but smaller neighbourhood shops, which do not have such high passenger volume, are feeling the heat.

“Ever since that place opened, our business has gone down by half, so we try to keep our prices low,” said a neighbourhood cake shop lady.

Work is also underway at two other Xchanges in Boon Lay and Tanjong Pagar, which should be ready by the first half of this year. – CNA/ac

Source : Channel NewsAsia – 28 Jan 2008

Suburban malls can command rentals close to prime locations: analysts

Captive shoppers in heartlands – like Jurong, Woodlands, and Tampines – are catching the eye of retailers.

And analysts say that is why some suburban malls can even command rentals similar to some prime downtown locations.

Some of Singapore’s heartland malls have been as big a hit with shoppers as their more upscale cousins in Orchard or the Raffles City area.

AMK Hub in Ang Mo Kio is the latest heartland mall on the block – following others such as Causeway Point in Woodlands and Jurong Point.

Food and beverage players at AMK Hub say the key is to choose areas with offices or government services so that the lunchtime crowd can help boost sales.

Mok Yip Peng, Managing Director, Soup Restaurant Group, says: “Our lunch crowd is made up of administration staff and executives from industrial parks and offices nearby while dinner is made up of families and newly-wed couples. The rental costs in downtown locations are slightly more expensive. The key benefit is that lunchtime crowd is guaranteed. As for dinner and weekend crowds, it’s about the same for both downtown and suburban locations.”

Besides offering dining options to working professionals, mall operators say crowds flock to heartland malls for the easy access to services and generally cheaper goods.

Peter Seetoh, Executive Director, Knight Frank Shopping Centre Management, says: “Convenience is a big factor because they can get what they need on a daily basis. But if they need something more in the higher fashion end, they’ll probably need to go downtown. The price points in the heartland malls are also more competitive from S$50 to about S$100 price range.”

However, rental costs for malls in the heartlands are not always cheaper.

It is estimated that the rental cost for shops in the basement AMK Hub works out to be about S$15 per square foot.

Property analysts say this is comparable to locations like Suntec City.

Orchard Road rents go for an average of S$20 per square foot.

And analysts say the higher rents in the heartlands can often be justified.

Daisy Loo, Retail Director, Jones Lang LaSalle, says: “Retailers do favour them, particular ones, because they have these captive shoppers group, which is their demand for goods and services is less fluctuating, more consistent. And also, they are less susceptible or less vulnerable to economic fluctuations, economic conditions or tourist arrivals.”

Jones Lang LaSalle research shows rents for malls in the heartlands dipped only 3 per cent during the the Asian economic crisis in 1997.

This compared to a 27 per cent fall in the Orchard Road belt and a 20 per cent decline in other downtown areas like Marina Bay. – CNA/ch

Source : Channel NewsAsia – 17 Aug 2007

The Concourse Shopping Mall: Angry over mall’s status

The notice to vacate is legitimate, but several tenants at The Concourse Shopping Mall are up in arms over the notice that was served on them ordering them to move out of their shops within six months to make way apartments.

Several of the shop owners are seeking legal advice to support their demands for compensation from mall operator, Hong Fok Land, over what they claim was a misrepresentation of the mall’s status.

Some, such as bar owner Ana Ng, recently spent thousands of dollars on renovation works after signing a new two-year lease agreement — only to be told she would have to vacate her premises by next February.

Ms Ng, who owns the Gd. Daay bar on the first floor of the mall, said: “If I knew, I would not have spent so much on the renovation.”

After signing the lease agreement last December, she spent about $50,000 to do up her shop.

Diving shop owner John Lee spent about $10,000 in April to do up his premises.

A frustrated Mr Lee said: “I signed a lease and three months later, they gave us a letter to say they are redeveloping the place.”

“The tenancy agreement is lopsided. I hope the authorities can look into such matter in the interests of promoting entrepreneurship.”

But their expenses pale in comparison to the $600,000 that Ms Kim Hyo Kyeong spent to renovate O Dae Yang Korean Seafood Restaurant and Family KTV Lounge.

After a futile meeting with a Hong Fok Land representative on Wednesday, Ms Kim decided to join Ms Ng and Mr Lee to explore legal means to secure compensation.

The three intend to get more tenants to join them.

The retailers’ woes started last month when they received a letter from their landlord, informing them of the need to move out.

In its reply to Today, the company said it had gotten provisional permission in June from the Urban Redevelopment Authority to develop 369 units of residential flats with communal facilities at the area.

It added that the project is in its planning stage, with sales and construction dates to be decided when other approvals are given.

On the notice to vacate, the company said: “Our tenancy agreement for the retail tenants has a six-months’-notice clause to terminate leases in the event of development, alteration and additional works to the building without compensation.”

It also stressed that it has given tenants more than six months to look for alternative premises.

Located at Beach Road, The Concourse Shopping Mall is home to some 70 shops, including restaurants, florists, pharmacists, as well as hair and beauty salons.

But not all shop owners think the move is unreasonable.

At least one tenant pointed out that the six-month notice to vacate was fair, while another revealed that he had secured a site at The Plaza Shopping Centre next door.

Property analyst Nicholas Mak, director of research and consultancy at Knight Frank, added: “When a landlord and a tenant enter into a rental agreement, they should do so with their eyes open.

“When the terms of the agreement become unfavourable later, they should not run to the Government and request for help.”

A market observer said the redevelopment project at The Concourse would change Beach Road’s landscape over the next five years.

Source : Today – 10 Aug 2007