LaLaport Kuala Lumpur mall breaks ground
Mitsui Fudosan's $374mn project largest outside Japan
CK TAN, Nikkei staff writer
KUALA LUMPUR -- Mitsui Fudosan, Japan's largest integrated developer, broke ground on Tuesday on the Mitsui Shopping Park LaLaport Kuala Lumpur, one of Southeast Asia's largest retail spaces under development.
The mall is being constructed in the city center on the site of Pudu Prison, a colonial era facility demolished as part of a government growth drive.
When completed in 2021, the five-story mall will offer 82,600 sq. meters of leasable space -- enough for more than 300 retail outlets. The project has an estimated cost of 1.6 billion ringgit ($374 million), and is a 50:50 joint venture between Mitsui Fudosan Asia and BBCC Development. The latter is collectively owned by Malaysia's state-owned Employees Provident Fund, UDA Holdings and prirvately held Eco World Development Group.
The project forms part of a bigger real estate development, the Bukit Bintang City Centre (BBCC), which includes hotels, apartments, and offices in a built-up area of over 600,000 sq. meters with a gross development value of 8.7 billion ringgit.
"I am confident that BBCC will succeed in further uplifting the image of Kuala Lumpur as an international modern metropolis," said Prime Minister Najib Razak at the ceremony.
Mitsui Fudosan Asia will lead the development, leasing, and operations drawing on its experience managing LaLaport malls in Japan. The group is aiming for a new urban lifestyle with innovative approaches to entertainment and education, according to Akihiko Funaoka, a senior Mitsui Fudosan executive. Among the attractions will be Zepp Kuala Lumpur, a concert hall and entertainment hub with 2,500 seats equipped by Sony Music Entertainment.
Mitsui Fudosan's existing regional investment is primarily in operating apartments, including in Malaysia. The shift to retail is a response to the growing middle-income market, according to Takehito Fukui, the company's managing director for Malaysia.
Isetan The Japan Store has already introduced some similar concepts to the Malaysian capital. Operated by Isetan Mitsukoshi, its six-story mall covers 11,000 sq. meters with dining and clothing outlets, and an area devoted to art and culture.
Malaysian-owned 1 Utama Shopping Centre meanwhile includes a baseball batting cage and scuba diving center among its tenants.
Mitsui Fudosan already runs Mitsui Outlet Park near Kuala Lumpur International Airport. The branded outlet store opened in 2015, and has traded briskly with locals and tourists from around Asia. According to Fukui, revenue was up 15% on 2016 in the first five months of the year.
Mitsui Fudosan is using operations overseas as a growth engine, and 550 billion yen ($5 billion) is being invested over a three-year period up to 2017 in the Americas, Asia, and Europe.