VietNamNet Bridge – A lot of high end shopping malls have closed down after
the failed efforts to drag out their existence.
High expectations, big failure
When it opened again in September 2011 after it changed its look, Hang Da
Galleria was believed to become an ideal place for merchants to gather in a
market, and for people to relax and enjoy entertainment services.
However, this has not come true yet. Hang Da Galleria cannot attract merchants
to lease retail premises. With the low occupancy rate, the shopping mall has
been closed down for upgrading.
Analysts blame the failure of Hang Da Galleria on the existence of more than one
owner. The primary investor decided to lease the retail premises for long time
to secondary investors. However, not many merchants have shown their interests
in the premises there.
Grand Plaza also had to close down in late 2012 for a similar reason. And the
same thing has been occurring with many high end shopping malls. The merchants
who have leased the premises there now think of transferring the premises to
others to stop loss.
The representative of a real estate consultancy firm said that at first, the
investors were advised to build up the old Hang Da Market (which is now Hang Da
Galleria) into a tourism site which specializes in selling Vietnamese
traditional items. However, the plan was refused.
Since Hang Da had more than one owner, it was very difficult to decide what way
Hang Da should go.
Leanne Mitchell, a real estate expert, said that many projects failed just
because the owners could not reach agreements in many issues.
She believes that shopping malls’ investors should not sell premises to too many
secondary investors, because the existence of many involved parties would make
it difficult to reach a common voice. It’d be better to keep a control over all
the matters of the shopping malls.
It is the owners of the malls who make decisions about the placing of the brands
at the shopping malls to ensure the highest possible harmonization. In case they
have to sell the premises definitely or lease for long terms, they should set up
clear provisions in the contracts in order to avoid the disputes.
More luxurious, expensive shopping malls expected
The current economic recession has forced many people to fasten their belt, thus
making luxurious shopping malls deserted.
In fact, there is another reason that keeps people away from the shopping malls
— the taxes of different kinds, valued up to 50 percent of the products’ value.
Mipec Mall, which was Pico Mall in the past, is now experiencing a period of
re-positioning after an unsuccessful business period. The shopping mall at
Indochina Plaza has also been quiet with very few visitors and buyers.
Analysts say the consumers’ confidence index decreased sharply in 2012 and it is
expected to decrease further in 2013, which would badly affect the retail
market.
The big guys in the retail market like Parkson and Lotte all have revealed their
plan to expand their networks. Parkson plans to open 3-4 new malls in Hanoi,
while Lotte is making hectic preparations to put the 65-storey building
capitalized at $400 million into operation.
Vingroup Group would open Vincom mega Mall Royal City and Vincom Mega Mall Times
City soon, which would cover an area of 460,000 square meters. Aeon Mall Vietnam
has received the investment license for its retail project with the investment
capital of $200 million.
Duy Anh