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Phnom Penh’s retail scene diversifies with community shopping centres

Traffic whizzes past TK Avenue. The shopping precinct is Phnom Penh’s first community mall.
Traffic whizzes past TK Avenue. The shopping precinct is Phnom Penh’s first community mall. Hong Menea

Phnom Penh’s retail scene diversifies with community shopping centres

Open-air retail space remains somewhat limited in Phnom Penh. But a unique approach on commercial retail development is set to change this and is going a step beyond simply​​ building retail space by focusing on the customer experience.

With an assortment of activities on offer, the community mall offers something for everyone, with the concept aspiring to be not just a commercial area, but a lifestyle destination.

The latest community mall development in Phnom Penh is The Park Community Mall. Spanning nine hectares of land on National Road 1 in Phnom Penh’s Chbar Ampov district, the development, which is set to open in early 2018, is a commercial destination that caters for those who like to eat, drink, shop, chill out and play sport.

According to Sim Kun Kossal, leasing manager at The Park project, The Park Community Mall aims to be a nature integrated, lifestyle community shopping mall.

The mall, he said, would be a destination for various food and beverage shops and other outlets. The precinct, of which the capital cost and owner were not disclosed to Post Property due to confidentiality reasons, is also set to include a soccer field and running track.

Distinctive from other commercial destinations in Phnom Penh, The Park has a strong focus on creating a quality atmosphere for customers through integration of greenery, while the mall is also strategically located close to river front winds from the east.

Kossal added that the development would include a variety of signature Khmer trees.

“We want to exhibit iconic Khmer tree breeds for people of all ages, especially the younger generations to understand the importance of greenery and develop a sense of appreciation,” he said.

A rising middle class is underpinning demand for shopping outlets, like The Park Community Mall.
A rising middle class is underpinning demand for shopping outlets, like The Park Community Mall. Hong Menea

As a fairly new and modern concept for Phnom Penh, The Park will focus on offering a range of services to customers.

“It [The Park] will be an innovative community mall development not limited to conventional commercial activities such as food and beverage. It will also offer a space for physical activity, have areas to sit back and soak up the greenery and will contain large parking bays,” Kossal said.

“Our development hopes to serve customers daily lifestyle needs and offers as a leisure destination for the urban population. There are further plans in the works to include a high-rise residence and other mixed-use buildings in the future to surround the mall,” he added.

James Hodge, associate director at CBRE Cambodia, said the community mall isn’t exactly a new concept as they are prevalent in neighboring counties, however added that it was an emerging retail concept for Cambodia.

According to Hodge, the new community mall development is just one way in which the country’s retail scene is developing and diversifying.

“A lot more choice is entering the Phnom Penh market. In 18 months’ time the retail landscape is going to be very different,” he said.

“As community malls form an important part of this evolution, the clue as to their positioning is in the name. They are targeted to serve their local community, the people who live, work and play in the close vicinity of the mall, often in a 0.5km – 1km radius,” Hodge added.

Hodge said the local focus of community malls was what differentiated it from larger scale shopping precincts such as AEON Mall which targets consumers across the whole city. Furthermore, while shopping centers are usually covered and enclosed buildings, community malls will typically be of an open format.

As community malls are smaller than large-scale shopping precincts, Hodge said they are unable to offer the breadth of services that larger formal malls can offer. As such, they tend to focus on consumer’s everyday needs, containing shops that stock grocery food, health and beauty products and entertainment services. Larger purchases of durable goods, specialist products and unique services and experiences are therefore left in the hands of the larger format shopping malls, Hodge explained.

Hodge added than modern community malls have a focus on creating a sense of ownership amongst their customers; which in turn promotes loyalty and helps the center retain customers who don’t want to travel too far to find services. A sense of ownership involved the creation of a comfortable space to shop, relax and enjoy time with family and friends and which tends to be more intimate than a shopping mall.

Construction is underway at The Park Community Mall.
Construction is underway at The Park Community Mall. Hong Menea

The typical size of a community mall is around 5,000 square metres, but some larger community malls can span 10,000 square metres. Hodge said larger community malls may be in danger of losing the intimate feel that makes the concept unique, and as such, larger centres have to be designed carefully to ensure they don’t lose the characteristics of the format.

At present, the most successful example of a community mall in Phnom Penh is TK Avenue. The center opened in 2014 at around the same time as AEON Mall and, according to Hodge, has achieved almost full occupancy ever since.

“We see strong ongoing expansion in the community mall sector, with much inspiration being imported from innovative projects in other Southeast Asian cities, particularly Bangkok where the community mall concept is widespread and particularly successful,” Hodge explained.

Van Chanthorn, CEO of Town City Real Estate, told Post Property that the community mall business was a great fit for Phnom Penh residents who are looking for a relaxed but modern and unique shopping experience.

“I think today, shopping at malls seems to be the thing to do, so the entrance of a community mall is a sign of success for the retail industry and middle-class consumers,” he said.

With developers keen to learn from successful international projects and a plethora of innovative architects based in Cambodia, the retail sector looks ripe for more unique retail projects in the future.

“This is an ideal time for the development of community malls,” Hodge said.

“Cambodia’s strong economic growth and the development of the middle class means than structured retail solutions will be increasingly required, and community malls will go a great distance to serving portions of this demand.”

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