Just How Much An Italian-style Shopping Is Worth?

Posted: June 10, 2011 in Uncategorized

Commentary by:  Albert Spencer (Malaysia)

10th June 2011  FRI

It was reported in the news, that an Italian-style shopping with Gondolas and Italian-style retail space in the northern city of TIANJIN (China) the same as Las Vegas and Macau Venetian costs about USD220m to build.  The 200,000 sq.m of Tianjin Florence Town will boost Tianjin’s tourism. The project was helped by an Italian group. So, it should be quite authentic in essence and style.

The northern region of China with Tianjin City (80km from Beijing) could easily rally a mass market of at least 150 – 200 million in population from the northern part of China region. Still, that’s besides the potential of in-bound tourism visitors from Taiwan, Japan, Korea and Russia.

Now look at another news report appended below just for comparison.

It was recently reported that Singapore’s IR – Marina Bay Sands was thinking of selling its Canal Shoppe at the newly built Integrated Resort in 2 -3 years time, for a whopping USD4b !!!

The Singapore government has placed restrictions on the selling of any part of the IR commercially, mainly,

(1)  Selling of any IR element to a 3rd party can only be done after 5 years of opening of the resort.

(2)  That such proposal must be approved by the local authority.

Put aside the above guideline, a tag of USD4b is really like shooting across to the Moon. Based on current observation of Marina Bay Sands non-gaming businesses, i.e. F&B, Convention and Shopping, none of them is considered doing well. In fact, from the industry the non-gaming elements are merely clawing along. 

So far, from the response of industry and investment analysts, this idea of selling the Canal Shoppe at Marina Bay Sands at the “suggested” price should not be taken too seriously.

Everyone by now would know how big is this market and returns of per square foot retail space in Singapore. There isn’t any element of big surprise to be expected.

 

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Comments
  1. Soh Wee Kiang says:

    Only fools would buy Marina Bay Sands shopping mall for USD4b.
    I incline to agree with the writer that Southeast Asian retail market cannot compare with China and East Asia.

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