Orchard Road’s malls have come under scrutiny recently as several venerable department stores have closed shop and the latest addition to the sprawling shopping street, Orchardgateway mall, struggles to pull in consumers.

Analysts have cited the weak yen as a cause of Orchard Road’s troubles. Tourists who once flocked to Singapore for the shopping are now choosing to spend their money in Japan, they say.

Yet this is only part of the story. Reporters who went down to Orchard Road on 6th June found one of the major shopping malls in Orchard nearly empty, even though it was a Saturday.

Real estate experts say that despite attracting many high fashion tenants and brands into the malls, there is little coherence or strategic intention behind the organization of these shops. In one shopping mall, for instance, a women’s lingerie shop sits next to a golf store, clearly reflecting the lack of strategic thinking based on knowledge of customer habits and movements.

Orchardgateway has already seen 5 tenants closing up shop and leaving, despite its prime location between famous shopping malls. Tenants complain that there have been days when some shops did not log any sales at all.

“Developers’ thinking has put consumers off,” said a businessman previously engaged in operating commercial complexes in Japan. When selecting tenants, property developers tend to focus on immediate income from rent. Too often, this approach results in a nondescript mall that fails to excite shoppers’ interest. A number of such facilities have cropped up along Orchard Road, and almost all of them have been struggling to bring in customers.

This situation is reminiscent of the challenges Japanese commercial facility operators experienced in the early 1990s. Commercial buildings near train stations had enjoyed heavy customer traffic since the start of Japan’s high-growth era, in the mid-1950s. But they struggled to stay competitive when large shopping malls started popping up in suburbs. These newcomers grabbed market share by playing up the convenience and fun of shopping in facilities that were more spacious and offered more to choose from.

Malls in suburban areas of Singapore such as new entrants JEM, Westgate, NEX and the newly refurbished Causeway Point see heavy traffic for similar reasons. The time has come for Singapore property developers to take a considered approach towards designing their malls and their branding if they look to stay competitive and afloat in an increasingly consumer driven market.

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