Bouncing back with new offerings

Older malls in the city centre are leasing spaces to businesses not traditionally found in shopping centres, to draw crowds

Walk around some malls and you might see units occupied by businesses you would not expect.

An indoor adrenaline arena? An optical illusion museum? The new campus of a private education institution?

With older malls in the city centre hit hard by competition from new malls, suburban malls and e-commerce, experts notice that in the past five years, such malls are increasingly leasing spaces to tenants not traditionally found in shopping centres.

Malls say they are trying to increase the diversity of their offerings. However, experts believe they may be doing so to fill up empty spaces in their malls.

The entire top floor at the 19-year-old Cathay Cineleisure Orchard, for instance, is occupied by Bounce Singapore - a 24,000 sq ft indoor activity arena that opened in June this year, housing 51 trampolines, two slam dunk lanes, a giant airbag, an obstacle course, three private party rooms and a cafe.

It provides consumers an additional option of fun and entertainment.

A CATHAY SPOKESMAN on having indoor activity arena Bounce Singapore in Cathay Cineleisure

A Cathay spokesman says having Bounce on board is in line with the mall's positioning as the "entertainment mall" along the Orchard Road belt. "It provides consumers an additional option of fun and entertainment," she adds.

At Wisma Atria, the Art Apart Fair showcases works of emerging and mid-career artists. It occupies about 6,000 sq ft across three shop units and will run until the end of next month.

Mr James Che, 55, sales promotion manager of Isetan Singapore, which is the landlord for the units leased to the fair, says that adding more non-retail businesses allows the mall to provide "a more holistic experience".

At Suntec City Mall, which is about 20 years old, the 10,000 sq ft Alive Museum - an optical illusion museum which opened in 2014 - features 3D illusionary artworks for visitors to interact and take photos with.

The 11,000 sq ft Pororo Park indoor playground on the second floor of Marina Square has a five-year lease with the mall. Opened last November, it features a train ride, ball pool, play gym, theatre and toy store.

Educational institutions are also being drawn into malls.

By November, Nanyang Technological University (NTU) will open a 10,000 sq ft alumni clubhouse at Marina Square. It will have a restaurant, bar and hangout areas for members to connect with one another.

Last month, private education institution PSB Academy announced that it will open a 100,000 sq ft campus at Marina Square. Slated to be ready by May next year, the campus will have a town hall, media studio and four lecture theatres.

Although the malls and businesses declined to reveal lease details, experts say such non-traditional businesses may be paying a lower rent than traditional businesses.

Mr Desmond Sim, 41, CBRE research head for Singapore and South-east Asia, says: "These businesses occupy a large area and are likely to have signed a longer lease than a normal shop.

"They are also 'destination tenants', which are by themselves likely to attract visitors to the mall. For these reasons, malls might be more flexible with rent payments."

Experts say that placing a non- traditional business in a mall is a boost to the shopping centre and the tenant.

Such anchor tenants are likely to help the mall pull in more customers, which can benefit other tenants, says ERA Realty key executive officer Eugene Lim, 49.

"For example, by having an educational institute within the mall, you attract students as well as parents. Both might buy food or do a bit of shopping in the mall."

Associate Professor of marketing education Seshan Ramaswami, 51, from Singapore Management University, says: "These businesses can guarantee significant income for the mall as they take up a large amount of space. Most of these new entrants are also unlikely to be competitors of the existing tenants."

For the non-traditional businesses, being in a mall means being able to ride on events, such as mall promotions, as well as use common facilities such as restrooms, parking spaces and shuttle bus services, adds Prof Ramaswami.

Businesses interviewed cite convenience of location and guarantee of human traffic - office workers, shoppers and tourists - as reasons for setting up in a mall.

Mrs Patsy Ong-Hahl, 51, managing director of Adval Brand Group, which opened the Alive Museum here, says: "Suntec City has a good mix of locals and tourists. Being here allows us to target both groups of customers."

Professor Lee Sing Kong, NTU's vice-president for alumni and advancement, says: "Marina Square's central location, as well as its proximity to MRT stations, means it is easily accessible to our alumni and staff."

In any case, the increase in non-traditional businesses in malls is indicative of changes in Singapore's retail landscape.

With new malls such as Waterway Point, which opened in Punggol in April, and upcoming ones, such as Northpoint City mall, to open in Yishun next year, competition is heating up.

Visa's Consumer Payment Attitudes Survey last year also found Singaporeans to be the biggest online spenders in South-east Asia, with 70 per cent shopping online at least once a month.

Assistant Professor of marketing Vishal Narayan, 44, from the National University of Singapore Business School, says: "With competition from e-commerce, suburban malls and new malls, the more established malls have no choice but to find new and innovative ways to draw shoppers."

A version of this article appeared in the print edition of The Sunday Times on August 28, 2016, with the headline 'Bouncing back with new offerings'. Subscribe