The K11 Art Mall in Shanghai
Leading Hong Kong developer New World Development Company Limited has selected real estate consultancy JLL to help lease its Shenyang K11 Art Mall. The retail development will be the biggest shopping mall in one of China’s best supplied markets when it opens in January 2016.
K11’s new project is positioned as a high-end shopping centre forming part of the mammoth Shenyang New World Center. The 1.2 million square metre development includes offices, hotel, serviced apartments, and a conference hall. The mall itself covers 257,000 square metres.
New World Development has already successfully opened K11 Art Malls in Hong Kong’s Tsim Sha Tsui, and on Shanghai’s Huaihai Lu, both of which successfully combine a retail podium beneath an office tower.
Leasing Sand in the Sahara
While New World has found success with its K11 malls in other cities, leasing out the developer’s jumbo-sized Shenyang mall could test the mettle of JLL’s retail team in northeast China.
The largest city in Liaoning province, Shenyang has become something of a poster child for China’s overbuilt property markets, including retail developments. A recent report by JLL competitor Colliers International found that Shenyang’s retail market had the highest vacancy of any city in the country’s northeast region, reaching 17.1 percent at the end of last year. Nearby cities of a similar scale such as Dalian, Tianjin and Qingdao all reported vacancy levels of between 4.7 and 6.7 percent.
Despite the challenges, however, JLL’s leadership appeared confident. “In China, JLL has helped many developers with their shopping centre leasing strategies, in which we could introduce new retailers from the overseas market to China by leveraging our network and team resources globally,” said Michael Wang, Managing Director of JLL Shenyang. “I am confident that, with this synergy, JLL is going to add value to the retail shopping malls,” he added.
Given that the city has already added more than three million square metres of new retail space since 2010, and is set to welcome 570,000 more square metres this year, that confidence should come in handy.
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