Orchard Central duplexes split up

by Michelle Tay

GLOOMIER times appear to have taken a toll on the upcoming Orchard Central mall near Somerset MRT Station.

The mall will no longer house two-storey shops, or duplexes, on its ground floor as had previously been announced, the project’s developer Far East Organization has told The Straits Times.

These duplexes were intended to have been glitzy, eye-grabbing outlets likely to have been leased by top-notch brands.

Instead, the three duplexes planned for level 1 have been split into single-storey units and leased to retailers wanting smaller premises.

Industry watchers said demand for the higher-rent duplex stores is likely to have waned due to the economic slowdown.

Also, the area, considered by some to be the more downmarket end of Orchard Road, may lack the cache needed to pull in the large brands that are more likely to take those spaces, they said.

Orchard Central is one of three new shopping centres to go up in Orchard Road in more than a decade.

The 14-storey mall is slated to open early next year, and will boast underground shops, restaurants with outdoor balcony seating, as well as a special ‘jewel box’ – a glass-fronted shop to be suspended in mid-air outside the building.

When contacted, Far East said: ‘We had more demand for single-floor units, and we are happy to report that the key level 1 shops facing Orchard Road have been snapped up. We also decided to change the original plans as this would mean more shopping diversity and choices for our customers.’

It added that the mall has one more duplex unit, on levels 3 and 4, which has attracted interest but has yet to be leased out.

Ms Lau Chuen Wei, executive director of Singapore Retailers Association (SRA), said it is ‘not surprising if there is a lack of demand’ for the double-storey units.

‘A duplex would definitely require a higher rental commitment, which is, by and large, something that retailers find quite hard to commit to at this time.’

Property consultants The Straits Times spoke to said duplex stores have high visibility so landlords would ‘normally want a very high-end brand’ to occupy them.

‘If I were the landlord, I’d have to give it to someone who is really worthy of it,’ said one retail property specialist, who declined to be named.

‘If not, splitting a unit into two will get higher rental,’ he added.

Some observers also say the fact that several malls are springing up at about the same time has created more intense competition in the battle for the brands.

Previously, Far East had told The Straits Times that its ‘jewel box’ store, to be designed by renowned Egyptian-born industrial designer Karim Rashid, will ‘as its name suggests…be occupied by an upmarket jeweller’.

But Cupid Jewels, a home-grown firm specialising in lower-priced bling, has now confirmed its tenancy there.

It has four showrooms in decidedly less swanky locales – Clifford Centre, Harbourfront Centre, Novena Square and OG Orchard Point – but said it will rebrand itself as a more upmarket jeweller at Central.

In contrast, Ion Orchard, the other mall being built at Orchard Turn, has snagged glitzy labels like Cartier and Louis Vuitton to front its duplexes, as well as haute jewellers Harry Winston, Chaumet and Boucheron to occupy its first floor.

But industry experts also defended Orchard Central’s positioning, saying the area near the Somerset MRT Station is no less attractive than the strip nearer to the Orchard MRT Station.

Mr Danny Yeo, deputy managing director of Knight Frank, said: ‘It’s not that this part of Orchard Road does not have a draw, it’s just not a main draw for the high-end segment.’

‘The malls near Somerset are all internally connected to each other. And there are enough young people who will find that this side will provide a good alternative to the strip between Ion and Ngee Ann City. Now Orchard Road has two distinct and strongly positioned areas.’

And Ms Daisy Loo, head of leasing and consulting at Sandalwood Retail, said: ‘Mass market brands can have duplexes too. It doesn’t mean only luxury brands can afford a duplex, and it doesn’t mean a duplex is the only thing that will earn you top dollar.’

She added: ‘It’s part and parcel of business to rethink strategies and review plans when market conditions change. Decisions are always based on changes in demand and tenant requirements.’


This article was first published in The Straits Times on September 5, 2008.

Republished September 7, 2008 on AsiaOne Business.

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