Global shopping center development is on the rise, with Asia leading the way.

 

According to CBRE's newest study, global shopping center development is still on the rise, with 11.4 million square meters of new space opening in 2014, up from 10.6 million square meters in 2013. Emerging regions, notably in Asia, continue to dominate the retail center development pipeline, with another 39 million square meters under construction. houses

China has the world's largest development pipeline, with 5.7 million square meters of shopping center area constructed in 2014. China completed 44 percent of worldwide development projects in the last 12 months, although the volume of new supply was down 14 percent from 2013. Three other Asian cities, Seoul, Kuala Lumpur, and Manila, were among the top 15 most active markets outside of China. Last year, the Lotte World Mall in Seoul was the largest completion in Asia Pacific, with 480,370 square meters.

China accounts for nine of the top ten most active markets, accounting for almost 60% of the entire pipeline of space now under construction. Shanghai has the greatest new space under construction, with 4.1 million square meters, followed by Shenzhen with 3.4 million square meters and Chengdu with 3 million square meters. The top five most active marketplaces are Chongqing and Guangzhou. There are more than 20 projects in the works in each of these Chinese cities. However, the majority of China's new supply is concentrated in the suburbs.

In total, new development in Asia Pacific covers 32 million square meters and is spread across 36 cities, with China, Thailand, and India accounting for almost 80% of the total. However, due to the economy and growing financial pressures on landlords, the supply of new development in China and India is at risk of slowing. Due to a shortage of finance, the construction of several retail malls has been halted, and in other cases, landlords are considering repurposing the buildings for other use.

"Improvements in city transit and the growth of decentralized residential zones have fueled retail expansion in the suburbs of key Chinese cities, with over 80% of supply in tier I cities concentrated in these locations. The target audience for these suburban malls is primarily local families "CBRE Asia's Senior Director, Head of Retailer Representation, Joel Stephen, agrees.

In other parts of Asia, leasing demand is strong in Japan's and Taiwan's gateway cities. The availability of prime locations, particularly those that can house flagship stores, is quite limited. Tokyo and Taipei are among Asia's most sought-after retail destinations in 2015, thanks to an increase in mainland Chinese visitors.

"In comparison to previous year, the drivers driving the development pipeline of additional space remain substantially identical. A increasing middle class in emerging nations, the urbanization of large cities, and a scarcity of high-quality retail space required for cross-border retailers are all factors to consider. As a result, Asia, particularly China, dominates new development "Mr Stephen says.