Sun Hung Kai Properties is to give its Beijing APM shopping mall a second major facelift in as many years to reposition the centre to appeal to local middle-income shoppers rather than tourists.
SHKP, the largest property developer by market value in the world, says it will spend another 300 million yuan (HK$347 million) on renovations to the mall, which is a major landmark in Beijing's shopping mecca of Wangfujing Street.
A 320 million yuan refurbishment in 2008 was aimed at increasing the appeal of the mall to young customers, but shopping traffic in the area had since undergone a significant change, said Ian Choy Chi-keung, SHKP's chief representative in Beijing. 'The retail market in Beijing is changing. The purchasing power of local middle-income and white-collar shoppers has grown substantially in recent years. The local customer market has matured,' Choy said.
An in-house survey revealed that average spending by local customers at Beijing APM doubled to between 400 and 600 yuan this year from 200 to 300 yuan last year, which lifted it above the average 300 to 500 yuan spent by tourists at the mall, said Raymond Ip, leasing director at the firm.
The profile and buying patterns of local shoppers has also changed. 'They used to be government officials or businessmen and they bought products to give to others as gifts. That's why sales of luxury brands expanded aggressively. But in the past two to three years, salaries of white-collar workers have risen rapidly,' said Ada Nip, head of retail at property consultancy DTZ's North China division. 'The monthly salary of a university graduate may be only 3,000 to 4,000 yuan in the first year, but will grow by many multiples in the next few years.'
Nip said there were now about 10 shopping malls in Beijing that were geared to appeal to wealthy and big-spending customers. The market was saturated and as a result international luxury brands were not expanding aggressively this year.
'But the middle-class market still has potential. Raffles City Beijing, and Joy City in Xidan and Chaoyang are among the few shopping malls targeting the white-collar market,' she said.
