“Ya Bi” – New malls, new investment destination

Did you know Kota Kinabalu is also a property destination for many people since many years ago? Yes, “Ya Bi” is just the mandarin name for Kota Kinabalu. Let’s talk about their malls scene today. Do you fancy shopping in Kota Kinabalu? Anyone who’s been to Kota Kinabalu over ten years ago would have shopped at some familiar malls including Wisma Merdeka, Centre Point Sabah and Karamunsing Complex. I have been to all three. In fact I think as someone from Peninsular, I have visited Kota Kinabalu more times than a typical Penangite visiting Kuala Lumpur. I think these older malls are still okay but everyone would always be asking for newer ones and recently there has been some sudden increase in malls. There are now new ones like Suria Sabah, Oceanus and Imago.

According to an article in Daily Express (Jan 2015), there is increase in retail space as well. This happened within past two years and the increase was said to be about 7-8 percent over the past few years. This has been brought about by the growth in population, higher purchasing power and even tourist arrivals. Kota Kinabalu is the primary city for all the Sabahans from smaller towns aspiring for a bigger city with opportunities but prefer to stay within Sabah. Before everyone start questioning about purchasing power, please look around you. The smartphones that people carry, the ever increasing new cafes and even the willingness to pay hundreds to hair stylists. This is the world of today. On and off, my parents are still questioning why people would be willing to pay RM12 for a cup of coffee with milk. Lastly, the tourist arrivals. Kota Kinabalu international airport is still ahead of even Penang’s international airport in terms of passengers per year.

Datuk Kenneth Yen, Chairman of VPC Alliance (Sabah) Sdn Bhd said that any new mall would need about two years to establish themselves. For example, even the Suria Sabah was not impressive in its initial years. Today, it is one of the best performing malls in the state capital. Well, these malls are now in Kuala Lumpur but I think they should really be benchmarking the best in KL today. Read my personal wish list for malls here:  My MUST have list for malls, both old and new  Yen said that in order to attract shoppers, malls must provide an experiential shopping environment. Newer malls will attract visitors for the very first time but they may lose out to the bigger and more established malls if they have nothing special to offer. There’s not enough time to visit two malls per day if that one mall has everything under one roof.

For 2016, Kota Kinabalu is projected to have 3.7 million visitor arrivals. Yen said that based on his own estimation, there are at least 800 Chinese (China) landing in Kota Kinabalu from the many major towns in China. One awesome point that he provided is that during the great times before the MH370 incident, some high-street shops in Jalan Gaya selling seafood products and traditional Chinese medicinal products could command a rental of up to RM15,000 per month! He elaborated, “Such days are returning. Chinese tourists buy a lot of the local cosmetics, bird’s net and dry seafood as the products are cheap and they are assured that they are original and of good quality.”

One thing’s for certain. Competition is heating up and there are more upcoming ones such as PacifiCity by Pacific Sanctuary Holdings Sdn Bhd, Aeropod by SP Setia Bhd, Sutra Avenue by Mah Sing group, GM Mall by Grand Merdeka, International Technology & Commercial Centre (ITCC) in Penampang by Sabahnilam Enterprise Sdn Bhd, City Point shopping mall and hotel by Kinsabina Croup of Companies and Skycity and 360 Boulevard project by Homesign Network Sdn Bhd.

As usual, even within the Klang Valley, many of the smaller malls would disappear after a while. Let me explain why. On weekdays, if the area is a residential one, not many people would be visiting a nearby mall. Due to jams, majority of the working population may choose to work late or have dinner before coming home. Thus, the weekday traffic is likely to be slow. During the weekends, if I am the younger ones, I would most probably visit the bigger and more established malls. If I have a family, I would need a mall which can cater to everything my family wants. From Toys R Us to supermarkets for grocery shopping and even a variety of cafes for lunch, tea break and dinner! Read here to understand a little more: Seriously, when there are just too many malls 

More malls do not mean a more vibrant property market. Agree? Well, if you were to tell the buyers of the many newer high-rise here in Klang Valley that there are NO MALLS nearby, they would suddenly lose half their interest and the willingness to pay a premium drops by half too. So, yes, malls do help. Thinking around, without more residents in Kota Kinabalu, there’s no way that these new malls are popping up. Not many owners are building these malls for fun. Let’s wish these new malls all the best and I also think that we can put Kota Kinabalu as a potential property investment destination. Happy visiting Kota Kinabalu or ‘Ya Bi.’

written on 16 Jan 2016

Next suggested article: Kota Kinabalu, one of the best for MICE in Asia

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