Shopping malls turn into recreational sites
Shopping malls turn into recreational sites
A few years ago, Jakarta experienced a mega-shopping mall
boom. How is the situation today? Is it feasible to develop new
shopping malls? The Jakarta Post looks into the issue. More
stories on Page 7.
By Rita A. Widiadana and Sri Wahyuni
JAKARTA (JP): Shopping malls have recently become popular
recreational sites for Jakartans.
Ten years ago, a shopping center with only a department store,
a supermarket and small shops could attract crowds. But demand
has changed. Consumers demand a place that has assorted stores
and a variety of entertainment and leisure activities in one air-
conditioned complex.
Megananda, an executive and a mother of two, said she often
brings her family to malls on the weekend and holidays.
"Going to a shopping center on weekends is almost obligatory
for our family. We save time by doing our shopping there. It is
very practical," Megananda said.
Many shopping centers, she added, also provide entertainment
for both adults and children, so her entire family is happy.
Harry Ciptadi, a 37-year-old banker, said that he went to shop
for high-quality brand names and his daily necessities at malls.
A number of shopping malls in Jakarta meet these requirements.
Plaza Indonesia in Central Jakarta was the first shopping center
in town to be built with the super-block concept linking the mall
with a five-star hotel and office building. Its 40,000-square-
meters of shopping area is home to 300 shops, including a Sogo
department store, a Times Bookstore, a Hero Supermarket, a Sega
entertainment place, a food court and boutiques selling
international brand names and other luxury goods.
Sylvia Ratulangie, the corporate secretary of PT Plaza Realty
which manages Plaza Indonesia, told The Jakarta Post that after
five years of operation, Plaza Indonesia's 17,000 visitors a day
see it as a family shopping center for middle and upper-class
Jakartans.
"We try to keep adjusting our products and services to
consumer demands and shopping trends," Sylvia said.
The Pondok Indah Mall in South Jakarta, is another place where
Jakartans hang out.
"A modern shopping center must offer a large variety of
attractions otherwise it is very hard to draw potential clients,"
deputy general manager Wibyakto said.
The 45,000-square-meter mall has 200 tenants, including
several anchor tenants like the Singaporean-franchise Metro
department store, Marks and Spencers and the Gunung Agung
Bookstore. The mall has a cinema complex, water park and swimming
pool, a fitness center, a museum and even a day care for babies
and toddlers.
The mall receives an average of 25,000 people a day. The
number increases to 40,000 on weekends and holidays.
Citraland in West Jakarta and Bintaro Plaza, Blok M Plaza and
Blok M Mall in South Jakarta are also favorite shopping
destinations.
Opportunity
Although the number of shopping centers has met consumer
demand, many investors believe there is still huge opportunities
in developing more shopping malls. In the last few years, Jakarta
has experienced a mega-shopping mall boom.
Two mega-malls, Plaza Senayan and MegaPasaraya, opened late
last month and several other massive shopping malls will open
throughout the city early next year. The planned shopping malls
include Kelapa Gading and Pluit Mega Mall in North Jakarta, Super
Mall Lippo Village Galleria and Taman Anggrek Mall in West
Jakarta and Pasadena Mall in East Jakarta, each of which has more
than 10,000 square meters of new retail space.
When these new shopping centers are completed in the middle of
next year, Jakarta will have 1.5 million square meters of retail
space.
According to a Collier Jardine property consultant, the
construction of new shopping malls is still economically
feasible. As compared to Singapore, available shopping center
space in Jakarta is still at a minimum. Singapore has only four
million people but two million square meters of shopping space.
Jakarta, whose population is expected to reach 10 million by the
year 2,000, has less than one million square meters to serve over
8.5 million people.
The demand for modern shopping centers is directly related to
the growth in Jakarta's middle and upper-class. Although
Indonesia's per capita income is only US$800, disposable income
among the urban rich is extremely high. In Jakarta, for example,
25 percent of the total population spends between $1,776 and
$4,200 a year.
The increased spending power of the middle and upper income
bracket makes building shopping centers profitable and therefore
very competitive.
"Rapid development of shopping centers will continue if the
number of people who can afford consumer goods also grows," Budi
Sugarda from the Management Institution of the University of
Indonesia said.
Sugarda added that it is normal for the demand for convenience
to increase because many Jakartans can afford to pay for good
quality and good service.
"The question is whether they spend most of their income on
consumer goods. Don't they think about saving their money or
investing it in profitable business activities?" Sugarda asked.
He said consumer habits have changed markedly with the growth
of shopping malls. "People would likely be more consumptive," he
speculated.
Sugarda, however, said that the development of mega-malls will
destroy small retailers, especially family-run businesses.
"Traditional stores and family-run shops will hardly survive
as people prefer to go to the more comfortable shopping malls
which sell similar products at a lower price," he said. This has
already happened in the United States and Europe, he added.
Suryadharma Ali, the secretary-general of the Indonesian
Retail Merchants Association, told the Post that many retailers
are skeptical that the new space will ever be put to good use.
Try telling that to Megananda's family.