China’s Malls Reboot

|

China’s Malls Reboot

Even government officials have worked out that something has to be done to reinvent malls (many run by government owned property developers) in their city centers and suburbs if they are to remain viable.

Not only are Chinese buying more and more online, but also when they do shop in physical stores, they want to shop in their local community, within walking distance from home. They are increasingly stepping away from the anchor hypermarkets in the malls that they have to drive to.

In Shanghai, for example, officials are celebrating the conversion of electronics-focused malls into “cultural and entertainment” centers. Doubtless we will soon see an overly supply of these. Metro City, for example, is converting part of its space into a 700-seat theater. Pacific Digital City is going further. It’s demolishing part of the current mall to build a recreation center. Other malls are not renewing leases for electronics vendors and are replacing them with restaurants. Where electronics-focused malls lead, others will follow.

Will the consumers flock to these repurposed malls in sufficient numbers? I doubt it. Will demand for eating out really grow that rapidly? Will restaurants be able to afford rents that mall owners need to charge to cover their interest payments? We will see.

Read more of my views on my blog, Gordon’s View. And please follow me on Twitter.

Image credit: Remko Tanis / Flickr

By |January 30, 2015|Categories: Gordon's View|1 Comment

One Comment

  1. Frank ZHAO February 25, 2015 at 11:18:00 - Reply

    The reason of Metro City reconstruction and convert the electronics pacific mall, is because consumers now are more and more buying electronics via internet rather than go to mall…so far the malls in Shanghai is experiencing the recession of their revenues, due to a) their fast growth in previous years rely on luxury brands, b) government anti-corruption, c) Chinese go oversea shopping, or the price-difference (due to custom tax, local management cost high) and d) mall’s slow reaction towards the changes and challenges…

Leave A Comment