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CNA
03-07-2025
- Business
- CNA
'We're relying on regulars': Leisure Park Kallang tenants worried as footfall drops with Cold Storage exit
SINGAPORE: Businesses at Leisure Park Kallang are grappling with declining foot traffic and dwindling sales following the March closure of Cold Storage, a long-time anchor tenant. Already facing a gradual drop in visitors over the years, the mall has grown noticeably quieter. March also saw the departure of Filmgarde Cineplexes and Coca Hotpot – exits that have further exacerbated the downturn. While the weekends bring an uptick in business, many tenants said it is not enough. Hockhua Tonic, located beside the now-shuttered Cold Storage, saw an 80 per cent fall in customers in the month following the supermarket's closure. Although events at the nearby National Stadium or Indoor Stadium draw more customers who mostly purchase bottled herbal teas, sales of dry goods have been 'so, so affected', said branch manager Liu Zheng Rong. 'We just renewed our rental for the next two years, but it has been really quiet. We're really worried,' he said. Other tenants echoed his concerns. Coffee chain Joe and Dough has seen sales decline since October 2024, and store-in-charge Shureen Sulaiman said she is uncertain whether this downward trend can be reversed. Even before Cold Storage's closure, sales in the first three months of the year were 'stagnant", she added. DOMINO EFFECT The simultaneous loss of two major anchors – the cinema and supermarket – has had a ripple effect, retail experts said. 'Mass marketers like supermarkets and cinemas often lead to destination retailing – where shoppers make that outlet the reason for visiting the mall, and the other smaller tenants then benefit from the foot traffic that is created,' said Dr Seshan Ramaswami, associate professor of marketing education at Singapore Management University (SMU). When those anchors leave, it is "difficult to recover", he added. Dr Samer Elhajjar, a senior lecturer in marketing at the National University of Singapore's (NUS) business school, said that this can lead to a "domino effect, where one exit leads to another". "The evolving retail landscape means consumers now demand more than just a place to shop," he added. "They're looking for immersive experiences, convenience and value. If a mall doesn't evolve to meet those expectations especially when competitors nearby do, it becomes very difficult for tenants to remain viable." Jack Investments, which owns Leisure Park Kallang, declined to comment on the impact of the closures. REGULARS AS "LIFE SUPPORT" At Eye Theory, an eyewear business that has been at Leisure Park for 16 years, optometrist Giles Wang hopes customers will return despite losing the convenience of combining their visit with grocery runs. "Cold Storage was here longer than us and we're not sure what our business will be like without them. We're relying on our regulars to keep coming back." The shop has sentimental value, he added. "We were here before Stadium MRT was up. Those days, the bigger malls wouldn't accept us because we didn't have deep pockets, but this mall did." A staff member at BedOrigin, which sells bedding products, said the store has been 'much quieter' since Cold Storage's closure, and now mainly depends on regular customers. When CNA visited on a weekday evening in May, the staff member, who only wanted to be known as Ms Goh, said only nine people had entered the store that day – with fewer than five making a purchase. 'We're not F&B. Some days, it's zero (customers),' she said. 'We're just waiting and seeing. The economy has slowed down and buying power is not like before.' NUS' Dr Elhajjar said that depending solely on regular customers is an unsustainable strategy. 'The nature of retail and F&B today is such that customer churn is high, you constantly need new customers to offset those who naturally drop off due to changing habits, relocation or simply boredom. "The real challenge is that without anchor tenants like Cold Storage to drive new footfall, the opportunity to attract new customers narrows dramatically," he said. "So while regulars are keeping some businesses afloat, they are essentially functioning as life support. If nothing changes structurally in the mall to reattract footfall or reinvigorate the space, this approach will eventually run out of steam." ATTRACTING THE YOUNGER CROWD Despite the slump, not every tenant is floundering. Businesses catering to children and youth, like indoor playground Wan To Play Capybara Creek, report steady weekend crowds and regular birthday party bookings. While weekday traffic dipped after Cold Storage's closure, the playground has managed to retain most of its visitors, said a staff member who wanted to be known as Ms Teo. The bowling alley and ice skating rink also continue to draw teenagers and families. When CNA visited on four separate weekday evenings, both venues consistently had over 10 visitors – a noticeable contrast to other outlets in the mall. Front desk staff at the bowling alley, Kallang Bowl, confirmed that business has remained steady despite Cold Storage's closure. These are "fairly unique" offerings in Singapore, said SMU's Dr Ramaswami. He said the mall could make up for the loss of anchor tenants by attracting other leisure and hobby businesses, and reinforcing its position as a leisure destination. 'Hosting more events focused on the youth and young family segments on a regular basis could also help draw in traffic. And of course, when there are major events in the stadium area, the mall could offer promotions that are tied to these events,' he said. QUIET, BUT CONVENIENT FOR SOME Some customers appreciate the mall's calmer atmosphere. Mr Firdaus Noah, a weekly visitor who takes his daughter to ballet classes at the mall, said he enjoys getting a coffee and relaxing at the eateries after a long day. The mall has always been quiet and he did not see much difference after Cold Storage closed, he added. Another weekly visitor, Mr Jeremy Sim, prefers to head to Leisure Park after his nearby tennis sessions instead of the more crowded Kallang Wave Mall. At Leisure Park, he is "guaranteed" to be able to find a seat at eateries. But other visitors said they prefer Kallang Wave Mall for its convenience and accessibility. 'Some of my friends don't even know there is another mall in Kallang. It just always seemed more convenient to visit (Kallang Wave Mall) instead since it's next to the MRT and we can have a quick dinner before heading for concerts,' said university student Ms Tay. Brandon Chan, senior lecturer of hospitality and tourism management at the Singapore Institute of Technology, echoed this, saying that without easy access and convenience, customers would not be motivated to visit Leisure Park Kallang and a 'unique selling proposition' needs to be created to increase visitor frequency. 'Kallang Wave Mall's direct access to the MRT unlevelled the playing field for both retail malls,' he said. 'Getting to Leisure Park Kallang would entail additional effort from customers unless there was a compelling reason for them to go out of their way to get there. 'At the moment, there are none." CAN THE MALL BE REVITALISED? Experts said that unless Leisure Park reinvents itself, it risks being left behind. Kallang Wave Mall has significant advantages, said Dr David Ocon, assistant professor of arts and cultural management at SMU. 'It is newer, seamlessly integrated with the Sports Hub, National Stadium and MRT, and features sports facilities such as an onsite rock-climbing wall, along with lifestyle and F&B options that align closely with the area's leisure identity,' he said. To stay competitive, Leisure Park could reposition itself with a 'clear niche' and introduce 'experiential concepts' that align with Kallang's leisure and sports identity, Dr Ocon said. He suggested having pop-up markets, holding community and sports events, and even partnering with small businesses or fitness operators to boost footfall beyond retail. 'Outreach efforts might be much needed to raise awareness among younger generations, many of whom have grown up with Kallang Wave Mall and may not even realise that another mall with unique offerings exists just around the corner.'
Independent Singapore
17-06-2025
- Business
- Independent Singapore
Gyms and tuition centres replace Singapore cinemas amid closures
SINGAPORE: Gyms and tuition centres have been replacing Singapore cinemas in malls amid closures, as footfall from cinemas wanes due to the rise of streaming services and changing consumer preferences. Meanwhile, other cinema spaces are drawing in immersive dining to draw in the crowd, as reported by Channel News Asia (CNA). Cathay Cineplexes, operated by media company mm2 Asia, faced legal action in February over alleged unpaid rent and other costs . Days after the reports surfaced, the cinema announced the closure of its West Mall outlet in Bukit Batok . In March, it also shut its outlet at Jem shopping mall, citing challenges the cinema industry faced since the pandemic in a bourse filing, CNA reported. These closures followed earlier ones that began in mid-2022. Over the past year, WE Cinemas, formerly known as Eng Wah Cinemas, and Filmgarde Cineplexes have also exited the cinema industry. At Leisure Park Kallang, the former Filmgarde Cineplexes unit will become an 'immersive dining' venue. The Singapore Tourism Board said Hidden Worlds, a themed restaurant focused on ocean conservation, will open there later this year. West Mall and AMK Hub, formerly occupied by Cathay Cineplexes, also plan to overhaul their cinema spaces. Singland, which owns West Mall, said it was in an 'active discussion' with potential tenants to 'explore opportunities to introduce new offerings.' Meanwhile, AMK Hub's asset and property manager, Link Asset Management, said it began upgrading level four of the mall, where the cinema was previously located, in July last year and is working to enhance its tenant mix. At Seletar Mall, Shaw Theatres closed its outlet in December. Mall management said then that they already had 'alternative plans' for the space. Dr Samer Elhajjar, senior lecturer in marketing at the National University of Singapore's (NUS) business school, pointed out a shift in how mall operators view cinemas. He said the pandemic accelerated a trend that was already 'brewing', as more people turned to entertainment at home, changing the value proposition of cinemas. Once home to a Cathay cinema that's now closed, Parkway Parade's general manager, Joey Teng, said they needed to 'monitor, adapt and refresh' their tenant mix to meet evolving shopper needs. She added, 'It is important to make sure our offerings remain relevant for our visitors and provide not only their ideal tenants but differentiators from surrounding locations.' RHB Bank Singapore's vice president of equity research, Vijay Natarajan, noted that while cinemas can still draw foot traffic, changes in how people watch content are pushing mall operators to look for better-performing and higher-paying tenants. Still, mall owner Lendlease said it continues to view cinemas as a 'relevant tenant' that adds variety to its premises. It also noted that bringing in a tenant from the same industry could help 'reduce capital expenditure and ensure stable income and cash flow' for both landlord and tenant. /TISG Read also: Cathay Cineplexes apologises after Save Our Screens campaign draws flak amid trouble using vouchers for certain movies
CNA
15-06-2025
- Business
- CNA
No longer a must-have? Why some Singapore malls are swapping cinemas for gyms and tuition centres
SINGAPORE: Gyms, indoor basketball courts, tuition centres and possibly, a restaurant with an immersive experience – these are some examples of tenants that have either taken or will be taking over former cinema spaces in Singapore malls. Once seen as anchor tenants with their ability to attract footfall, cinemas are facing challenging days with the rise of streaming services and evolving consumer preferences. Cinema closures have regularly made the news in recent years. Cathay Cineplexes, owned by listed entertainment firm mm2 Asia, raised further alarm when news broke in February that it owed millions in rent to mall landlords. The struggling chain has shuttered two outlets – West Mall and Jem – this year, adding to a string of closures since June 2022. The tough environment has also claimed two casualties outright – WE Cinemas, formerly known as Eng Wah Cinemas, and Filmgarde Cineplexes both threw in the towel over the past year. And not all the spaces freed up by these closures have occupied by other cinema operators, as malls appear increasingly open to exploring alternative uses. 'There's been a shift in how mall operators view cinemas,' said Dr Samer Elhajjar, a senior lecturer in marketing at the National University of Singapore's (NUS) business school. 'The pandemic accelerated a trend that was already brewing – people are consuming more entertainment at home, on-demand. This changes the value proposition of cinemas.' NEW PLAYERS At the Parkway Parade shopping centre, Cathay Cineplexes had an outlet with seven halls for about six years, up until August 2023. The space on level seven has since been transformed into an education and enrichment hub, as its operator calls it. Within is the Scholar Basketball Academy, a training school with several indoor basketball courts, and math enrichment centre Think Academy. Parkway Parade's general manager Joey Teng said: 'We monitor, adapt and refresh our tenant mix to meet the evolving needs of shoppers, which may differ across precincts. 'It is important to make sure our offerings remain relevant for our visitors and provide not only their ideal tenants but differentiators from surrounding locations.' Perhaps more significantly, The Cathay along Handy Road, once home to one of Singapore's oldest cinemas, no longer has one. The iconic building, which held a soft opening in end-March after two years of renovations, now has PSB Academy as a key anchor tenant, with the private educational institute taking up the entire fifth floor. Elsewhere, the six-storey mall offers a 24/7 gym along with a range of health and wellness, beauty, homeware and education-related businesses, including arts and performance schools. Hoardings seen within the mall in May also showed the Nanyang Technological University Alumni Club and Sheng Siong supermarket among others. Cathay Organisation, the owner of The Cathay, declined to comment for this story. At Leisure Park Kallang, the space vacated by Filmgarde Cineplexes is set to become an 'immersive dining' venue, two tenants told CNA last month. The mall owner did not respond to CNA's request for an interview. But the Singapore Tourism Board earlier announced that Hidden Worlds, an 'immersive dining experience themed around ocean conservation', will open at Leisure Park Kallang later this year. West Mall and AMK Hub also plan to overhaul the cinema spaces formerly occupied by Cathay Cineplexes. West Mall owner Singland said it was 'actively in discussions with potential tenants to explore opportunities to introduce new offerings'. Link Asset Management, the asset and property manager of AMK Hub, said it has since last July 'embarked on asset enhancement' for level four of the mall, where the cinema was previously located. It said it was reconfiguring the space and repositioning the tenant mix to better serve the community. At Seletar Mall, the cinema space previously occupied by Shaw Theatres could see new offerings. When announcing its closure last December, Shaw said the mall's management had 'alternative plans for the space'. CNA reached out to the owner of Seletar Mall but did not get a response. A CONTINUING TREND Experts reckon both shopping mall and cinema operators will continue to assess their business operations amid changing consumer behaviour. Challenging market conditions mean that cinema operators are not always willing to take over legacy cinema spaces, unless the location shows strong potential, said NUS' Dr Elhajjar. Mall operators too are becoming 'more pragmatic' and will prefer tenants, such as gyms and co-working spaces, that can deliver footfall throughout the day, he added. While cinemas still hold the ability to attract foot traffic, the 'noticeable structural change' in consumers' viewing patterns will likely nudge mall operators to seek better-performing and higher-paying tenants, said Mr Vijay Natarajan, vice president of equity research at RHB Bank Singapore. Cinemas generally pay lower rents due to the large space they lease over a longer period, and the hefty upfront investment in soundproofing and fitting out the space with tiered seating and audio-visual systems, according to industry experts. A February DBS report said rents charged by mall operators are 'typically lower on a per-square-foot basis, typically one-third average rental rate a mall commands'. Yet it is also no walk in the park to repurpose and lease out former cinema spaces due to their unique attributes. Apart from size, these spaces tend to come with high ceilings and are located in parts of the mall - such as the top floor or in the corner - which lack a prominent facade. This rules out traditional retail or food and beverage (F&B) tenants who rely on a visible frontage to attract walk-in customers, said Mr Wong Xian Yang, head of research for Singapore and Southeast Asia at Cushman & Wakefield. On the other hand, learning or enrichment centres; gyms; and activity-based businesses like indoor playgrounds might be more of a fit, he added. Mall operators also consider a tenant's ability to bring in footfall, and enrichment centres rank high in this regard. 'When parents bring their kids to enrichment centres, they will need to hang around for a few hours, which means they will eat, have coffee or shop around, making them a good replacement,' Mr Wong said. Having gyms and experiential F&B operators as replacement tenants is also a 'smart move', said Dr Elhajjar. The former brings people into the mall at off-peak hours, while the latter taps on the evergreen pull of F&B. 'While they may not replace the entertainment value of cinemas in a traditional sense, they serve a more functional role in the new mall ecosystem as they keep people coming back regularly,' he told CNA. STILL 'RELEVANT'? That said, the current situation is not dire enough for landlords to see cinemas as a risk and to be replaced entirely, experts said. The delayed rental payments by Cathay Cineplexes are unlikely to snowball or even become uncollectable, said Mr Natarajan, citing how rental deposits typically required by landlords can be used to offset defaults. In some cases, leases are also backed by underlying corporate guarantees. It can also make more financial sense for a replacement tenant to be from the same trade. Tenants are usually required to restore the rented space to its original condition at the end of a lease. Depending on the size and complexity, reinstatement of a former cinema space can 'take a few months and easily cost a six-figure sum', said NUS' Dr Elhajjar. Mall owner Lendlease echoed this, noting how having a replacement tenant from a similar trade will allow both the landlord and tenants to 'reduce capital expenditure and ensure stable income and cashflow'. The mall owner said it continues to view cinemas as 'a relevant tenant' that adds to the variety of options in its premises. 'Key cinema operators in Singapore have expanded their offerings beyond traditional movie screenings to accommodate corporate and event bookings," said Mr Guy Cawthra, chief executive officer of Lendlease Global Commercial Trust Management. "This demonstrates the versatility of cinema spaces.' Lendlease Global Commercial Trust Management is the manager of Lendlease Global Commercial REIT (LREIT), which is the landlord of malls such as Jem shopping centre. LREIT had terminated its lease with Cathay Cineplexes in March due to rental arrears amounting to some S$4.3 million (US$3.4 million). An instalment plan to settle the outstanding owed has since been agreed upon, the landlord told CNA. Shaw Theatres will now take over the 47,000 sq ft cinema space previously occupied by Cathay. Hopes are high for the new cinema, whose official opening date has yet to be confirmed. 'Shaw Theatres at Jem will be the only cinema operator catering to the Jurong East catchment," said Mr Cawthra.
