The Klang Valley is facing an oversupply of retail space with more than seven sq ft per capita based on the population of more than seven million. New completions last year, which included Atria Shopping Gallery in Damansara Jaya, Sunway Putra Mall in Kuala Lumpur, Ikea Cheras, Emerald Avenue in Selayang and Star Avenue Lifestyle Mall in Shah Alam, had resulted in more than two million sq ft of new retail space.
This is not the case for other states. For example, even though Terengganu has a population of about 1.1 million, its retail space per capita is low, at 0.9 sq ft per person.
Seeing an opportunity for modern retail offerings, Pelaburan Hartanah Bhd (PHB) is planning a mixed-use development in Kuala Terengganu, which will include a mall to be leased out entirely to its anchor tenant, Sogo (KL) Department Store Sdn Bhd.
The project is in line with PHB’s long-term plan to go to different states. With most of its investments in the Klang Valley, the company currently owns four malls in Kuala Lumpur, Selangor and Melaka. It also has other assets in Negeri Sembilan and Iskandar Malaysia in Johor.
Datuk Kamalul Arifin Othman, PHB group managing director and CEO, tells City & Country that the mixed-use development will sit on a 10.81-acre leasehold site in Kampung Ladang Tanjung in Jalan Sultan Zainal Abidin.
“We bought this piece of land from state-owned Lembaga Tabung Amanah Warisan Negeri Terengganu in October 2015,” he says. “Jalan Sultan Zainal Abidin in Kuala Terengganu is like Jalan Sultan Ismail in Kuala Lumpur — it is a prime road. The mall is located 1km from Pasar Payang, a tourist attraction. It is also facing the KTCC Drawbridge and the 30-storey Menara MBKT, both of which are under construction.”
He adds that the drawbridge will shorten the travelling time between the city and the state airport by half. Currently, it takes 40 to 45 minutes to go to the airport.
Located at the mouth of the Terengganu River, the KTCC Drawbridge is the country’s first drawbridge. Scheduled for completion by the end of next year, it is set to be an iconic landmark in Kuala Terengganu.
The mixed-use development will be launched in two phases. Phase 1 will consist of a 15-storey serviced apartment block and a mall, with a net lettable area of 715,000 sq ft. The block, which sits on top of the mall, will be kept by PHB for recurring income. The tentative plan for Phase 2 will be a 16-storey hotel, but Kamalul says the final plan will depend on market demand.
The gross development value for the whole project is about RM860 million.
“We are naming this mall Mayang Mall because the word ‘mayang’ is related to traditional things in Terengganu. It is a 6-storey shopping mall with 1,500 parking bays. There will also be a ballroom in the serviced apartment block,” Kamalul says.
The mall is jointly designed by architectural firm GDP Architects Sdn Bhd and retail planner Lead 8 Pte Ltd (Singapore). Construction is scheduled to commence by middle of next year.
When completed in the first half of 2020, the mall will be injected into Amanah Hartanah Bumiputera (AHB), and the net rental income will be distributed to the investing public. AHB is a shariah-compliant unit trust fund launched by the federal government in November 2010.
Kamalul says Mayang Mall will be the first full-fledged modern shopping mall to cater for people from Terengganu, Kelantan and Pahang.
“We are pleased to have Sogo as our partner,” he adds. “We were looking for a partner to take up the mall. Sogo is in expansion mode and that’s where we meet. We signed an agreement in October to lease the entire mall to Sogo outright.”
Meanwhile, Datuk Mohamed Khadar Merican, chairman of Sogo (KL), notes that the advantage for Sogo (KL) to manage the entire mall is that it can get the right retail mix according to the requirements of local residents.
“By doing so, you don’t mess up the offering,” he says. “The mall is for the mid- to mid-upper income group and the tenants will be a combination of local, regional and international brands. It will also provide opportunities for local traders to do business alongside established retail chains.”
He adds that Mayang Mall will provide a place for regional and international brands to expand to the east coast, and Sogo is also looking to bring in new brands to Terengganu consumers.
Sogo will take up 150,000 sq ft, and bring about 280 tenants into Mayang Mall, including fashion outlets, cinema, supermarket, wellness centre, food and beverage stalls, bookstore and a food court. It plans to launch the mall to trade partners by the second quarter of next year.
Datuk Alfred Cheng, Sogo (KL) managing director, says the retail operator has received enquiries from some interested tenants although the mall has yet to start its marketing activities. Currently, Sogo KL receives one million shoppers a month, while some 5,000 to 6,000 of its loyalty card members are from Terengganu.
“Many local and international brands have been wanting to go to Terengganu and this is the first time that a modern shopping mall is available there,” Cheng adds. “I think the market there is ready for a mall. Nowadays, when people go to a shopping mall, they also want to look out for local or international products or designs.”
Datuk Mahmud Fauzi Muda, PHB group chief operating officer, says the significance of this project is its scale. As the biggest shopping mall in Kuala Terengganu, it will provide sufficient critical mass for retailers there.
“All the traditional and modern stuff will be in one location in modern and comfortable settings, where local shoppers and tourists can experience the different cultures in Malaysia.”
Meanwhile, Kamalul says the development is now in the groundwork stage, and PHB is working on the details of the serviced apartment block, such as the number of units and sizes. He estimates it will be about 200 units of 3- to 4-star offerings, targeted at both local and foreign tourists.
He is confident the project will work out well as it is the first of its kind in Kuala Terengganu and the state has been supportive. The mall is also expected to create about 3,000 jobs in the sales, maintenance, security, transport and management sectors once it is fully operational.
“This project is in line with the state’s goal to bring in Grade A developments to Terengganu. The state government also wants to attract more tourists to stay in the capital. With this development, tourists will have more options apart from just going to the islands as they can shop and eat at the mall and stay at the serviced apartments,” Kamalul says.
“The mall will also have a positive impact on the local economy as new business opportunities are being created. We are also looking at programmes to attract local consumers,” he adds.
News Source:(Racheal Lee)