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New malls herald retail revolution

New malls herald retail revolution

11-mall-Use.jpg
11-mall-Use.jpg

Clean floors and air con, or sweat, grime and pungent odors? For many Cambodians, modern

supermarkets and malls are replacing the street market as the shopping scene of choice.
Sebastian Strangio and Meas Sokchea look into what’s driving the transformation.

 

TRACEY SHELTON

Sorya Market, the best-known of Phnom Penh’s new-look malls, offers eight-floors of cool, well-ordered shopping arcades just a short walk from the congested Central Market.

In the mid-afternoon heat, Phnom Penh’s Sorya Market is an oasis of air-conditioned comfort. Absent are the shoving crowds and stifling heat of nearby Psar Thmei; in their place, Sorya’s automatic doors slide open to release a gush of cool air and eight floors – over 40,000 square meters – of well-ordered shopping arcades offering everything from the latest electronics, music, films and banking services to clothing, jewelry, sunglasses, shoes and Western-style fast-food outlets.

 

Except for the Khmer script dancing across the facades of the shop fronts, it could be a mall anywhere in Southeast Asia.

 

The last few years of rapid economic growth have seen the beginning of a proliferation of new Western-style malls across Phnom Penh. Since Sorya Market was built in 2002, shopping centers such as the Sydney Mall, Parkway Centre and Pencil Supercenter have followed in Sorya’s footsteps.

 

The latest entry will reportedly be the work of California-based JSM, which has announced its intention to build shopping malls in Phnom Penh. First up for the company will be the Embassy Center, which will include over 30,000 square meters of retail space, 24,000 of which have been pre-let to the Malaysian department store Parkson. The deal was first reported by London’s The Times Online last June.

 

The New Central City Plaza development, being built by the Indonesian Lipo Politan Corporation on Russian Boulevard, also has plans to include a 145,000-square-meter “plaza” incorporating 567 shops, 28 restaurants, two cinemas and a 4,054-square-meter food court.

 

A lot of this is being driven by the emerging middle-class, but also I think by the influences coming out of Thailand and Vietnam in terms of retail development.

 

When asked why she thinks the project will be successful, Lipo Politan sales representative Chhem Dalin simply replies, “Why not?”

 

It’s a fair response. Paul Guymon, general manager for Cambodia and Laos at local market research company Indochina Research, expects to see the trends towards Western-style consumerism continue.

 

“I think we’re only going to see an uptick in terms of what [projects] have been announced and what will evolve over the next few years,” he says.

 

“A lot of this is being driven by the emerging middle-class, but also I think by the influences coming out of Thailand and Vietnam in terms of retail development.”

 

Given the state of the regional economy, there’s little indication of a slowdown in retail development in Cambodia.

For the new middle-class, shopping malls such as Sorya are already part of the weekly routine.

 

Rady, 20, shops there twice a week. “It is more comfortable here, and less busy than other markets,” he says.

 

While prices are more expensive in Sorya than just down the street at the outdoor markets, Rady reasons, “They might be expensive for the poor and cheap for the rich, but they’re okay for me.”

 

Sean Mengly, who runs a clothes shop on the ground floor of Sorya says the mall is so busy she rarely takes time off from work.

 

“Sorya is more famous than other markets,” she says. “It is always busy, and attracts all kinds of people – especially during the Chinese New Year and other holidays.”

 

Does this mean that the city’s traditional markets are a thing of the past?

 

Under the art-deco dome of Central Market, once considered as modern as today’s air-conditioned malls, Lorly Gek explains that her business selling watches is no better or worse off than before the competition came along.

 

Central market, she says, “has many more sellers and has been here for such a long time.”

 

Others worry, though. Chey Choucheng, who has sold clothing at Central Market for nearly 20 years, thinks the malls are drawing shoppers away from the old markets. “Every mall has air-conditioning and electricity. But at Psar Thmei the electricity is still very unreliable. At the moment, we have no electricity from 11:30am until 1pm,” she says. “It is not comfortable here like at Sorya.” As if on cue, the fluorescent lights and electric fans splutter into action. It is 12:50pm.

 

However, with more malls opening every year, there also are signs that the novelty may be wearing off. Ung Khoung, who sells jewelry at Sorya, says business is not as good as it once was.

 

“It was once popular because it was set up earlier than other [malls]. But many come now to eat or just have a look and don’t buy anything,” he says.

 

Either way, the new malls are here to stay. Although many are being built and funded by foreign companies, they are doing so with considerable local involvement, according to Guymon.

 

“Rather than looking at the market solely on a cash profit basis… [these projects] are more and more locally driven because the local people can see some sort of perceived need,” he said.

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