By NST Property/ Kathy B. - February 20, 2024
KUALA LUMPUR: White knights and investors are entering the Johor real estate market, particularly to save distressed shopping malls, said KGV International Property Consultants executive director Ir Samuel Tan.
Some malls, like Lot 1 Waterfront City Mall, need a new lease on life, he said.
Situated directly in front of the palace and facing the Straits of Johor, the five-storey mall is now deserted and a great eyesore, Tan said.
The Lot 1 mall was constructed for more than RM100 million in 2000 as part of the Johor Bahru (JB) Waterfront City floating project. The RM6 billion JB Waterfront City project was launched in 1996.
Tan said that in order to bring people into the city centre, the entire Lot 1 site will be upgraded into a town square and broadwalk featuring an iconic revolving tower.
He told NST Property that a number of JB malls are considering big upgrades or redevelopments.
The ideal course of action, according to him, is for an investor to forcibly take the property with government support.
Tan also urged mall owners to plan modifications to their properties given that a bigger portion of JB is expected to benefit from significant developments like the special financial zone (SFZ) and special economic zone (SEZ), as well as infrastructure improvements.
He said that the Forest City shopping mall, which has been sluggish since the outbreak, could do better going forward.
"The plan to make Forest City an SFZ will create job opportunities and bring people to stay, work, and shop there," he said, adding that improved connectivity from Singapore will turn this duty-free island into a shopping paradise.
He expects this destination will be revitalised with more meetings, incentives, conferences, and exhibitions (MICE).
"It is feasible to have Forest City serve as a transportation centre and have high-speed rail pass through it, even though it would cost more to build.
"Nonetheless, it is valuable to have it there if the advantages outweigh the disadvantages. Forest City will experience a revitalisation that goes hand in hand with the SFZ. This ought to become a must-see location for both foreigners and locals," he said.
According to Tan, suburban malls, including Midvalley at Southkey, Paradigm Mall, Aeon Tebrau, Aeon Bukit Indah, and Sutera Mall, will also experience the knock-on effects.
These, he said, are models of proper mall management.
"These malls frequently relocate their tenants to provide customers with a novel experience. To set the malls apart from the competition, new brands are added. In addition to shopping, family-friendly recreational activities are included to make it a complete experience," he said.
Tan said that in order to draw customers, some of the older malls will need to be renovated and revitalised to attract visitors.
He said that The Zon at Stulang Laut has aged over time and needs renovations.
"The inconvenience of clearing customs deters some people from going there. Given that it is sited within a duty-free zone, it is an attraction for those who want to purchase selected items free of tax. The uniqueness of The Zon is its suitability as a MICE centre. Specific efforts must be made towards that purpose," he stated.
Another well-known facility that is underutilised, according to Tan, is Leisure Mall.
He said, the mall needs physical improvements and greater tenant attraction efforts in order to draw in customers.
"Despite its prime location, the tenant mix is subpar. Generally speaking, stratified malls that sell individual spaces do poorly because the mall owners are unable to regulate the tenant mix," he said.
Source: https://www.nst.com.my/property/2024/02/1015373/revitalising-distressed-malls-johors-real-estate-market
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