Despite the high number of existing malls in Klang Valley, it’s highly unlikely that a fifth of these would close down over the next five years, according to the past president of the Malaysian Association for Shopping and High-Rise Complex Management.
“There are about 250 malls within the Klang Valley. If 20 percent of them shut down within the next five years, it would mean that up to 50 malls will be closed,” Richard Chan told The Star.
He is referring to the forecast of SwhengTee International Founder Datuk Seri Gavin Tee that around 20 percent of shopping centres in the area would cease operations within the next five years, while 50 percent would struggle due to oversupply of retail space and the growing popularity of e-commerce.
However, Chan conceded that competition among malls and retailers has become fiercer in recent years and there has been a marginal decline in occupancy levels.
“There has been a drop in occupancy rates but it has been small, maybe as much as one percent.” This is also less than the percentage of newly completed space, which stands at about eight to 10 percent.
While the actual figures were few, he admitted that there had been a number of mall closures in the past few years.
“Some buildings, like Uda Ocean and Plaza Warisan, were shut down to make way for the MRT, not because business was bad. Also, those buildings aren’t actually malls,” noted Chan.
He also pointed out that the SS2 Mall at Section 19, Petaling Jaya was closed for redevelopment. While its space will be reduced substantially, it will be more community-oriented, with a focus on better food and local services.
Meanwhile, Retail Group Malaysia (RGM) reported that the retail sector declined by 1.2 percent in Q1 2017 in light of the sluggish Chinese New Year sales.
However, retail sales for the entire year is predicted to grow by around 4.5 percent, according to the Malaysian Retail Chain Association (MRCA).
This is expected to be driven by the country’s tourism sector due to an anticipated rise in visitor arrivals from China, Australia, Europe and the US, said MRCA President Datuk Gary Chua.
He highlighted that foreign visitors are spending more on shopping when they visit Malaysia, and this group contribute the second largest foreign exchange money here after manufacturing.
“About 20 years ago, only about five percent of tourist spending was on shopping. Today, that number is up to 30 percent,” Chua added.
Among many new commercial developments in Malaysia are:
2. Sinaria
Image sourced from The Star
Radin Ghazali, Content Writer at PropertyGuru, edited this story. To contact her about this or other stories email radin@propertyguru.com.my
For more information on new top homes, check out PropertyGuru’s New Property Launches and Project Reviews.
