ION Orchard will open its doors on Tuesday in its soft opening, with over 70 per cent of the shops ready for business.
It is the second major mall to open in a decade along the prime Orchard Road shopping strip, with 96 per cent of its space leased.
After two and a half years, and more than S$2 billion in investment and construction costs, the eight-storey mall, with a retail mix of established brands, flagship stores and new-to-market shops, is ready for business.
In order to incentivise the tenants to open by Tuesday, the developers gave them a 30 per cent rental rebate until end October. And for those who could not open by Tuesday, they received a smaller tiered rebate.
But can the brand new mall put the sparkle back into Singapore’s lacklustre retail scene?
Latest figures show that May retail sales rose marginally by 0.8 per cent compared to April, after two consecutive month-on-month declines.
The mall’s developer Orchard Turn Developments is bullish about prospects.
Soon Su Lin, chief executive, Orchard Turn Developments, said: “The property market is cyclical. We believe this is a long term investment for us and the tenants have full confidence that the market will turn around.
“We have an unmatched location on top of the MRT station, stunning architectural design and the tenant mix is very interesting.”
Another thing it is banking on – the 200,000 daily footfall along Orchard Road.
But with more than 20 per cent of Singapore’s retail space concentrated along this prime shopping belt, competition will be tough.
When asked if it will offer more help to tenants, the developer says it will keep a close eye on the bottomline.
Soon said: “We believe in the relationship as a partnership and we will monitor their sales and we’ll work with them. Under our contract, our rental structure is such that we are paid a base rental or a percentage of turnover, whichever is higher.”
ION will officially open in October, at which point it aims to have more than 90 per cent of shops open.
Meanwhile, Orchard Residences, which is part of the development, is 84 per cent sold and should be ready by the middle of 2010.
Source : Channel NewsAsia – 20 Jul 2009