Shopping mall industry could lose over RM750m during 14-day MCO: Association

KUALA LUMPUR (March 23): The Malaysia Shopping Malls Association (PPKM) is appealing to the government to provide urgent relief as it estimates that the shopping mall industry will lose more than RM750 million, excluding turnover statistics from the retail sector, during the 14-day movement control order (MCO).

The estimate includes super-regional malls, regional malls, neighbourhood malls, premium outlets, and shops that are allowed to stay open during this period, and excludes stand-alone hypermarket centres or supermarket centres in the street.

"More importantly, the shopping mall industry requires this urgent relief to preserve cash flow and maintain employment so as to hold off lay-offs for both the retailers/tenants and mall operators for as long as sustainable," PPKM said in a statement today.

"While most malls remain partially open to provide essential services to consumers during the MCO, it is a most trying situation as both landlords and retailers are equally adversely affected but both parties have to collaborate to bear the unprecedented burden and pain together," it added.

As such, PPKM reiterated that shopping mall members will need to develop different action plans on a case-by-case basis, depending on different critical factors involved such as location, business tolerance, and rental structure.

It acknowledged that there are wide differences in the rental structure among different categories of tenants and different malls, so each mall will have to come up with mutually-beneficial accommodations for their lessees.

PPKM also commended Sunway Malls’ rent-free pledge for their tenants who are not providing essential services during the March 18-31 MCO, but maintained that the move is entirely dependent on the mall operator's prerogative and circumstances, and does not represent the whole shopping mall industry.

Nevertheless, the association pointed out that shopping mall operators have always assisted tenants during challenging times, such as the Severe Acute Respiratory Syndrome (SARS) outbreak in 2003 and the Asian Financial Crisis in 1997.

"Therefore, for sustainability in the long term, we urge all member malls to seek advice from their respective owners, investors and management and work out a practical and urgent solution for their tenants with non-essential businesses who have been impacted negatively," it said.

Click here to see commercial properties for sale in Kuala Lumpur.

Click here for more property stories.