In the article, Link CEO George Hongchoy shares the extensive experience of Link to transform old shopping malls into social hubs, and why he thinks Link has a social responsibility to run shopping malls that are good for both residents and tenants.

Although Hong Kong is a relatively small city compared to others in Asia, when it comes to retail space, Hong Kong punches well above its weight. About 40% of the city’s gross retail area of 100 million square feet comprises shopping malls, and there are more than 1.7 shopping malls for every square mile of the city – the densest collection of shopping malls in the world. Why, you may ask, are shopping malls are so popular among Hong Kong people?

In my opinion, this is because apartments in Hong Kong are generally too small for people to congregate with family and friends during holidays. As a result, people hang out, visit shopping malls and cafes, and dine out with friends instead, making neighbourhood malls a “third place”, where they spend most of their time outside of homes and work.

In view of the diversity of people in each community and to function well as a third place, it is important for each shopping mall to form a design team that comprises staff from various departments and property design experts. As such, malls can develop creative customer-oriented design plans and bring bespoke experiences to visitors.

When constructing a new shopping mall, everything starts with a clean slate. It is therefore easier to incorporate elements related to the neighbourhood’s unique environment and features into the planning and design. However, when it comes to transforming an old mall, the challenges and efforts required are often much larger, as the existing facilities and designs are too outdated to function as a social hub, let alone meet customers’ expectations.

Having completed a total of 87 asset enhancement projects since its establishment 15 years ago, Link has gained rewarding experiences in repairing and enhancing assets of different sizes, including retail ones. I would like to share the challenges we have encountered in carrying out these projects, and our insights on how we have successfully turned shopping malls into social hubs.

Stakeholder Communications

To utilise limited space efficiently and to fulfil demands in terms of both living space and basic amenities, most neighbourhoods are developed so that housing estates are adjacent to shopping centres. Neighbourhood malls, then, are not only spaces where residents buy fresh produce, dine and shop, but also places that they pass through when going to work or school. As malls are intertwined with daily life, residents and tenants have a vested interest in shopping malls’ asset enhancement works. Therefore, communication with tenants and stakeholders is crucial before an enhancement project kicks off.

In addition, since the public space around housing estates and neighbourhood malls is usually co-owned by the residential property owners and the shopping mall owners, asset enhancement works may be constrained by ownership-related issues. For example, the construction of covered pedestrian pathways between residential buildings and shopping malls cannot occur unless consensus is first reached among stakeholders, including the owners’ corporations of the housing estates, on things such as future repair and maintenance, as well as land use rights of involved residential areas.

Facility Planning

Asset enhancement works of a neighbourhood mall usually include repositioning and redesign of the layout of the entire property, conversion of the interior space, inclusion of more facilities, and improvement of both the interior and exterior designs, among others. To entice visitors within the mall’s district as well as those from other districts, the mall’s “software” also needs to be enhanced, including things such as adjusting the tenant mix based on customer needs, providing more customer services and conducting various promotional campaigns. All these efforts help boost tenants’ businesses and make the surrounding neighbourhood more vibrant.

Neighbourhood demand should be considered a critical factor in the planning of retail facilities. For instance, there was once a small fresh market at The Temple Mall which had poor footfall because of geographical limitations and competition from a larger fresh market nearby. In view of that, some years ago, we turned the fresh market into retail shops and restaurants to use the space more efficiently, offering more options for residents’ daily needs. In contrast, we turned a floor of retail space at Nam Cheong Place into a fresh market last year to provide convenience to the residents of fast-growing Kowloon West, as the existing fresh market in the district was far away from residents.

As I mentioned earlier, many neighbourhood malls are adjacent to housing estates, so the impacts of asset enhancement works on residents needs to be carefully considered, and works should be adjusted as and when appropriate. For example, to minimise disturbances to residents, entrances of shopping malls should be kept apart from those of residential properties, and there should be sufficient signage to prevent shopping mall visitors from entering housing estates. Likewise, neon signs should be avoided on exterior walls of shopping malls to reduce light pollution. 

As for the direction of footfall, centrally located flagship tenants that are connected to MTR exits often bring multiple benefits to a shopping mall, as they link different areas of the mall, drawing visitors to those areas and improving the footfall of other tenants. Therefore, introducing flagship tenants like a department store is worth considering during asset enhancement. Food courts and food streets are also helpful in drawing visitors who use the mall as a pass-through to access public transport interchanges, so these are beneficial add-ons during asset enhancement.

Interior Designs

Decades-old shopping malls and fresh markets often use designs that do not meet the latest standards in fire protection and barrier-free access requirements, so we need to address these issues when conducting asset enhancement projects on older properties. This also gives us the chance to enhance overall access by renovating shopping malls to cater to the different needs of a wide range of visitors, including the disabled, the elderly and pregnant women. This reinforces the relationship between the shopping mall operator and the people in the community while also increasing the footfall of the mall.

In addition, the floor heights of old properties are often low, which limits sightlines and the sense of space. Asset enhancement gives us the chance to improve the overhead designs of shops and fresh market stalls to alleviate these issues as well.

Without a doubt, inspiration can often be drawn from industry players in other markets when it comes to introducing pragmatic and aesthetically pleasing retail property designs.

There have been some notable examples of fresh markets that have improved their architecture and operations in recent years through asset enhancement by applying lessons from successful overseas fresh markets. These have resulted in open, non-linear design layouts that create wide sightlines for visitors, allowing them to see all the available stalls the moment they step into the market, which can help tenants’ sales. The environment, hygiene and accessibility of modernised fresh markets have also been much improved, with wider and barrier-free pathways for shopping carts, wheelchairs and baby carriages.

The flow and habits of customers in the neighbourhood are other important factors in shopping malls’ planning and design. For example, in shopping malls located near public transport facilities, more people tend to use the mall washrooms, highlighting the importance of using durable and easy-to-clean materials to reduce long-term operating costs and maintenance. 

Creating a Vibrant Community

Asset enhancement is not an one-off exercise. No matter how good a design is, it will inevitably become outdated in the future due to customers’ changing tastes and trends. To keep up with customers’ increasing expectations and to sustain the success of shopping malls, mall operators need to review the design and planning, and enhance their facilities regularly. 

With so many shopping malls and retail facilities in Hong Kong, the competition is very keen. Whatever the locational advantages a mall has, there is no room for complacency. 

By continuously updating and innovating, shopping malls can increase customer flow, upgrade services for customers and create employment for the community thanks to increased retail opportunities. Indeed, shopping mall operators have a social responsibility to build an energetic and vibrant community by running shopping malls that are good for both residents and tenants.

With shopping malls likely to remain a favourite social hub of Hong Kong people, shopping mall enhancement is a journey that never ends.
 

We welcome your view. Please write to enquiry@linkreit.com if you have any suggestion and feedback.