Generation gap in malls of Asia

Ronald Reagan once reported back to the White House press corps as follows upon returning from a tour of Latin American countries: “Well, I learned a lot. I went down there to find out from them and learn their views. You’d be surprised. They’re all individual countries”.

All individual, indeed.

After spending much of a month on the retail trail in China, India, Hong Kong, Singapore and Manila, very much the same can be said of shopping centres in Asia.

In Hong Kong and to a lesser extent in Singapore the industry is thriving on a steady, if fundamentally repetitive, diet of vertical malls. Tourism is strong, particularly in Hong Kong, where mainland Chinese accounts for a third of the spending in some of the city’s cherished high-end centres.

Manila is more diversified, with a solid enclosed mall tradition, but branching out into hybrid centres like Ayala’s superb Greenbelt and Bonifacio Global City.

Western-style shopping is everyday reality for millions in all three countries.

This is far from the case in India and China. There, shopping centres face mountainous problems that simply can’t be disguised by all the hype. One of my travelling companions, a seasoned mall design expert from Sydney, reckoned it would be a generation before the industry really got on its feet in either country.

As a design specialist he is aghast at the mistakes that have been made there by Western companies with outsized reputations, brought in to give their developer clients a competitive advantage and instead giving them the kiss of death. He has a roster of clients now that have gotten fed up with the big architecture firms and sent them packing.

In India, the problems are writ large and they are not restricted to design flaws. Gargantuan malls that are built too close together and are lopsidedly reliant on fashion tenants because there is no one else to put in the millions of square feet of space.

The centres have an uncanny knack of looking dated from the minute they are opened. It doesn’t help either that they are often built next to roads that are hardly fit for the horse and cart age.

People go to these places and walk around, but mostly they don’t have the income to spend on the merchandise on offer. Even having a good nosh in the food court is beyond the means of many. While having lunch in the largely empty food court of one such mall in Mumbai, I noticed three teenagers sharing a meal off one plate.

Many of these centres are either unviable from day one or will be uncompetitive within a year or two.

This doesn’t mean though that India’s basic demographic story isn’t still in place. But the malls already in existence today and those that open next year and the year after will, with some notable exceptions, not be the beneficiaries.

One such exception is the four-year-old Select Citywalk in Delhi, where many of the city’s burgeoning hoi polloi go to shop and be seen. Select Citywalk is mostly occupied even after four years of trading, a rare distinction in India where the tenants typically start to bail at the first opportunity.

Even Select Citywalk though is a bit hard on the eye, unless shoebox architecture is your thing. And this isn’t a problem confined to Asia.

George Orwell once wrote in his book Down and Out in Paris and London about buildings “which stare from the English coast like idiots staring over the asylum wall.” He could equally have been talking about many of our shopping centres around the world.

Back in India though, I watch people hanging out in front of the small tumbledown shops that still account for the overwhelming majority of the nation’s retail sales. Sometimes they have been moved to riot over the spread of what in India is referred to as “organised retail.”

Instead of rioting, they probably should have just taken a look inside a few of the shopping centres – they wouldn’t have been half so worried.

* Michael Baker is a retail and property analyst and consultant. He can be contacted at Michael@mbaker-retail.com or www.mbaker-retail.com

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