Opportunity Beckons
While 2023 may have seen a slightly subdued Asia Pacific real estate market due to high interest rates, a slow recover in Mainland China and geopolitical tension, an upturn appears to be just around the corner, offering the perfect opportunity for RLI to delve into a selection of real estate projects that are the leading the evolution of retail in the region.
This is the viewpoint of CBRE in their report entitled ‘Asia Pacific Real Estate Market Outlook 2024 – A Tale of Two Halves: Headwinds Followed by Recovery’. The report continues to say that in the retail space, Asia Pacific will see weaker spending growth in 2024 on the back of the softer economic outlook. Despite a cautious approach to CapEx and store network planning, retailers are poised to capitalise on favourable market conditions to upgrade and expand in 2024. Most Asia Pacific retail markets will register rental growth, although the magnitude of any increases will be modest.
Meanwhile, PWC’s ‘Emerging Trends in Real Estate Asia Pacific 2024’ report highlights that while the long-suffering retail sector appears to be on the mend, with significant numbers of investors indicating willingness to buy retail assets in principle, even if very few of them are yet doing so in practice. Cap rates remain too compressed for now, although investment volumes could quickly rebound if anticipated rental growth arrives.
What this shows is that the market is gradually making a comeback and there are opportunities abound for those willing to take the risk and move forward.
Projects Across Asia & Australasia
The first phase of C Future City in Shenzhen, China launched in April last year by developer Centralcon Group with design and architectural work from Aedas and it is a TOD mixed-use urban complex comprised of retail, office, hotel and residential elements. C Future City is a large urban regeneration in Shenzhen Shangsha Village that covers over 100,000sq m, building a new city that preserves the historical significance while creating a contemporary and sustainable urban community. Integrating ‘nature, technologies and art’, C Future City blurs the exterior-interior boundary by injecting greenery and immersive people-centric experiences to create an interactive dialogue with the urban neighbourhood. This development creates a series of architecture landmarks fully incorporated with advanced building technologies, digital arts and biophilic design. It sets a new benchmark for urban renewal in Shenzhen, revitalising the area and the surroundings.
Another project designed by Aedas and opened in June last year by developer Shaanxi Nan-Feihong Industrial Co., Ltd., the Lovi Center in Xi’An, China serves as an urban oasis for the city. The mixed-use landmark is comprised of a shopping mall, office and hotel towers. Designed to be a vibrant shopping destination, Lovi Center has become a unique retail-recreational attraction through the hybrid of public space and greenery. The project is filled with 100 per cent natural greenery and flowers through podiums, gardens and green belts, marking itself a people-centric location with diverse commercial activities. It creates an immersive experience that consists of art and cultural exhibition, delivering an interactive and inspiring journey for visitors. The whole design takes inspiration from four seasons, immersing various flower characteristics into the façade, canopies, public and interior space. A cascading glass funnel is designed in the atrium, serving as a canvas for a 360-degree light show and uniting disparate elements on each floor.
Developer Ingka Centres, experts in creating unique meeting places around the world, opened in April this year their ninth site in China and the first in Northwestern China. Livat Xi’an, which is located in the Yanta District of Xi’an City, represents a 4.3bn RMB investment, making it the largest wholly foreign-owned commercial project in Shaanxi Province. With a total leasable area of 125,000sq m, the meeting place is driving 5,000 jobs across 400 mixed-use retail and leisure brands. These are spread across retail, dining, entertainment, children’s activities and lifestyle options including 50 brands making their regional debut, such as MUJI, Bilibili Goods and Tianwen Kadokawa. The meeting place is anchored by IKEA’s second store in Xi’an, with Ingka Centres and its sister company IKEA joining forces on their shared vision of “creating a better everyday life for the many people”.
Set to open in September, the M8 revitalisation project in Macau, China by developer China Construction Engineering (Macau) Company Limited aims to make a positive contribution to cultural tourism within the city. The development revolves around creating a harmonised mixed-use urban cultural quarter that will serve as a contemporary lifestyle retail and cultural destination. With the objective of attracting visitors from both regional and international, this new destination will offer diverse opportunities to enhance Macau’s role as a co-creating hub for the promotion of cultural tourism in the neighbourhood. Taking inspiration from the rich heritage and stories of the past, the nine-storey-high retail destination will provide quality-crafted experiences that evoke an authentic sense of place. The spatial layout will take cues from Macau’s local heritage buildings and feature an open-plan hall that encourages interaction among visitors and activities. The central escalator hall will connect each level, facilitating connectivity between shops, events, exhibitions and restaurants. On the rooftop garden, guests will be able to not only enjoy views of Macau’s local streets, but also participate in diverse events promoting cultural exchange and celebration.
Back in April, developers DFS Group and Shenya Group held a signing ceremony to mark the official commencement of the DFS Yalong Bay project. The 128,000sq m scheme, which is being hailed as the first world-class, seven-star luxury retail and entertainment destination on the island, is slated for a 2026 opening. According to DFS Group and Shenya Group, the project – to be jointly built and operated by the partners – is expected to reach USD1.38bn in annual sales and attract 16 to 18 million visitors per year by 2030. It will bring fresh energy into the high-quality development of Hainan’s tourism industry, the partners pledged. DFS Yalong Bay is slated to become Sanya’s premier destination for luxury shopping, world-class accommodation, dining and entertainment. It will feature luxury brands including those from LVMH Group to serve domestic and international high-end consumers, with elevated immersive concepts across multiple categories such as fashion, watches & jewellery and beauty.
The Southside is officially open for business. Claiming the title as the largest lifestyle shopping mall located in the Southern District of Hong Kong Island, this exciting new complex by developer MTR Corporation stretches over 510,000sq ft and is home to over 100 retail stores and restaurants, cafes, a movie theatre, a massive supermarket and a whole lot more for visitors to enjoy. Adhering to the concept of “Art in MTR”, The Southside is committed to fostering an artistic community by infusing art elements into the mall while also strengthening its connection with the local community. The mall’s key design takes inspiration from Island South’s nature and coastline; using curves and waves and an elegant beige palette to echo the surrounding environment. The mall’s inaugural phase opened in December 2023, featuring various dining options, including the historic Queen’s Cafe, household supplies, everyday services, and more. The mall is also connected to Exit B of the Wong Chuk Hang MTR station, making it easily accessible for visitors and residents in the neighbourhood.
The upcoming Kai Tak Mall by developer K11 Group has reached 70 per cent occupancy rate, with the retail precinct set to consist of some 200 stores. Slated to open to be completed in the second half of 2024, the 700,000sq ft Kai Tak Mall comprises three main towers, reaching five floors in height, which are connected by a 700m-long Sports Avenue that integrates the retail complex with the surrounding parkland. Upon completion, the retail area is poised to become Hong Kong’s largest ‘Sportainment’ landmark; home to world-class sports academies, including Kyung Hee Taekwondo, Hong Kong Karate Academy and Hong Kong Rope Skipping Academy. The new mall forms part of K11’s burgeoning Kai Tak Sports Park which spans 28ha and sits within the redevelopment on the site of the old Hong Kong International Airport in Kai Tak. The overall project is slated to be completed next year.
11 SKIES is a future HL$20bn mixed-use destination located at SKYCITY. It is a game-changing destination that innovatively combines world-class retail, dining and entertaining experiences with a Grade-A business cluster. At over 3.8 million square feet, 11 SKIES stands as the largest all-in-one retailtainment destination in Hong Kong. It houses over 800 shops, 120 dining concepts and Hong Kong’s largest indoor and immersive entertainment zone at 570,000sq ft. Three thematically-designed business towers specialising in cross-border professional services complete the 11 SKIES ecosystem, making this the must-visit destination in Hong Kong. Opening in phases between 2022 and 2025 by developer New World Development, the project is strategically located right next to the Hong Kong International Airport, Hong Kong-Zhuhai-Macao Bridge and Tuen Mun-Chek Lap Kok Link.
Taurus Zentrum is a shopping mall under construction in Thiruvananthapuram, Kerala, India and it is set to open in 2025. When completed it will be one of the largest and most exciting retail, entertainment and dining destinations in the country with over 700,000sq ft of gross leasable area. The mall will feature dozens of local and internationally-known retail brands, a multitude of dining options and a wide variety of entertainment including Kerala’s largest multiplex. The multiplex will have 15 screens, including an IMAX theater, and will be operated by Cinepolis. Zentrum will act as the nucleus of Taurus Downtown Trivandrum and of the wider Technopark region, as well as a regional destination for the Trivandrum urban agglomeration and all of South Kerala and Tamilnadu. The mall is owned and managed by Taurus Investment Holdings and designed by the international architectural firm, Benoy.
Developers Mitsubishi Estate and Tokyo Broadcasting System have broken ground on an entertainment industry hub in central Tokyo that will span 205,800sq m including office, theatre, retail and hotel space. Set to be called the Akasaka Entrertainment City, its goal is to establish a hub for fostering industry development. The upcoming two-building complex is led by a 40-storey, 167,650sq m commercial tower which will have 34 levels of office space, four floors of retail and a single layer start-up hub. Located in a traditional entertainment area, Akasaka Entertainment City also includes an 18-storey, 38,150sq m block which will include 12 floors of hotel space and six levels for theatres. The complex is scheduled for completion in 2028 and is also within seven minutes’ walk of two more subway stations.
Snøhetta has unveiled the design for its largest project in Japan to date, a mixed-use development in Tokyo. The 117,000sq m Shibuya Upper West Project by developers Tokyu Group is located in the Shibuya district of Tokyo. Billed as the city’s newest ‘urban retreat’, it is scheduled for completion in 2027. The development will bring together a vibrant combination of high-quality retail, a contemporary luxury hotel, and rental residences as well as art and culture in the Shibuya district for the very first time. The project will be developed in collaboration with the adjacent Bunkamara cultural complex, which promotes art and culture throughout Tokyo. The Shibuya Upper West Project is set to become a new landmark in Tokyo. Horizontally connecting out to the city and the surrounding areas while stretching vertically to the sky, the building is designed as a landform, rising from ground level with its terraced steps, paying tribute to the distant foothills of Mount Fuji.
The Exchange TRX is a dynamic retail and lifestyle destination that is seamlessly integrated into a 10-acre public park. Launched in November last year with additional phases due to open through 2027, the project invites the community to explore the future of experiential retail, sustainable urban living and vibrant cultural expression. Part of the 17-acre lifestyle quarter of TRX, The Exchange TRX brings international placemaking and sustainability standards to Malaysia and is strategically located in the nation’s first dedicated international financial district (IFC). With more than 400 stores spread across 1.3 million square feet of net lettable area (NLA), the scheme redefines the retail landscape with the introduction of global firsts and new-to-market brands. It is also the first retail asset in Malaysia to achieve LEED Gold Certification, underscoring its commitment to sustainability. This groundbreaking development was jointly developed by Lendlease, a globally integrated real estate group based in Australia and TRX City Sdn Bhd, the master developer of the Tun Razak Exchange (TRX).
Back in December, the EM District, a prominent global commercial hub situated on Sukhumvit Road, introduced its latest and most ambitious shopping and entertainment destination, EMSPHERE. The scheme, developed by The Mall Group, stands out thanks to its distinctive industrial design style that seamlessly integrates modern ‘smart’ technology and the use of light and colour to enhance the overall atmosphere. Spanning over 200,000sq m across two interconnected buildings, EMSPHERE brings together over 300 stores and more than 1,000 brands, making it a unique fashion, dining and lifestyle destination.
Snøhetta, in collaboration with A49 Architects, has designed their most extensive project in Asia for MQDC, one of Thailand’s leading property developers. The project is a 250,000sq m mixed-use building in the upcoming CyberTech district of South Sukhumvit in Bangkok. The Cloud 11 project aims to create a new lifestyle environment and surroundings within the area. Designed to cater to people’s daily needs and requirements, several restaurants will operate from a centralised kitchen, a gym, a wide selection of retail stores and two hotels. The project also includes a variety of cultural offerings such as a library, educational venues and creative workspaces fit for the modern, hybrid way of working from home or outside the office. The project is expected to complete towards the end of 2024.
One Bangkok is a highly-anticipated future development which will deliver 1.83 million square meters of integrated mixed-use development on a 16 hectare site in the heart of Bangkok. Located adjacent to the city’s iconic Lumphini Park, One Bangkok will be Thailand’s largest integrated development comprising premium grade-A office buildings, luxury and lifestyle hotels, luxury residential towers, interconnected retail precincts, art and cultural hubs and public space. The development is expected to accommodate up to 200,000 people daily following its full completion in 2026 and it is under development by Frasers Property. The development will feature eight hectares of green and open spaces, with architecture and tropical planting seamlessly intertwined to establish a tranquil setting in a vertical environment.
Frasers Property Australia has won permit approval for the first stage of a retail complex in Melbourne’s burgeoning western suburb Mambourin. Mambourin Marketplace, which will be anchored by a major supermarket operator, will feature 7,200sq m of retail space, including a planned medical area, pharmacy and up to 25 specialised retailers including fresh food grocers, cafes and restaurants. The first stage will be supplemented by a landscaped urban plaza with approval for a children’s play area, artwork, al fresco dining, a central events space and end-of-trip cycling facilities including bike storage, showers and changing rooms. The $50M Mambourin Marketplace will be developed by Frasers Property and will complement the recently announced Good News Lutheran College P-12 Campus. Mambourin Marketplace is planned to be the first phase of a broader retail complex that includes about 25,000sq m of retail space, potentially adjoining a proposed train station and local business district when it opens its doors either late this year or early next.
Closed for its redevelopment since January last year, Harbourside Shopping Centre is currently undergoing renovation works to make way for a world-class retail, residential, commercial workplace and entertainment precinct. The redevelopment of Harbourside will reimagine the Darling Harbour waterfront for the 21st century, reconnect with the people and places of Pyrmont, and create a network of new public spaces that bring residents, workers, tourists, and locals together in a locally loved mixed-used precinct of the future. Developer Mirvac is seeking partners to be a part of this visionary new chapter by shaping this Harbourside urban retail hub with retail spaces for lease now. Known around the world as the place where Sydney celebrates, this is an opportunity to bring global ideas to the forefront of the city at Tumbalong’s retail precinct. Demolition works have commenced with civil works anticipated to start by by mid-2023. The overall development is expected to be completed in mid-2027, although some areas of ground floor are planned to be open ahead of this, which will be completed in a staged fashion.
Arriving in September this year by developer Auckland Airport, Mānawa Bay Premium Outlets in New Zealand will be a fashion-led offering, with space to connect customers to over 100 of the best international and local brands, curating an exciting, rewarding and seamless experience in a unique New Zealand way. Mānawa Bay has been designed to set a new benchmark for outlet shopping in New Zealand. Mānawa Bay will be a purpose-built destination focused on delivering a customer-led experience bringing the best fashion, athleisure, lifestyle and homeware brands together under one roof. Nestled on the water’s edge overlooking the mangroves, Mānawa Bay will offer great shopping, unique park-like grounds and outdoor spaces within our estuary location.
