Beijing Retail Market, August 2007

Implications: The Beijing market has shown considerable improvements in the last 2 years with some new offers with a higher level of retail tenant. In some respects Beijing can be said to have overtaken China's commercial capital Shanghai 

Analysis:

Kicking the tyres of the Beijing retail the other week was a far more pleasant experience than expected. Admittedly it has been a year and a half but nothing had prepared me for the change. Change not just in the quality of tenants in the shopping centers but the presentation of indoor and outdoor public spaces. This is about more than just begonias on every street corner, the little patches of desert that used to be on every street corner are now covered in green grass and not a drop of Dulux in sight. One is only left wondering where the water is coming from to support all this blooming foliage.

Anyway, back to the shopping. Beijing now has a significant number of sophisticated major retail destinations, more than just a couple a few years back. And Beijingers have found their wallets. Conventional wisdom always had it that Beijingers do not do conspicuous consumption, at least not in their hometown, but in the run up the Olympics the self imposed moratorium on spending seems to have been lifted.

The greatest contrast came visiting Shanghai’s Cloud Nine shopping centre in ZhongshanPark the day after my return from the Capital. Cloud Nine is a disaster. Having seen crowds of people at the entrance I had hoped that my previous impression of the place had been wrong and maybe, like Beijing, it had turned a corner. I soon realized, however, that the crowds were outside gulping in fresh air, someone with their head in the clouds has turned the ventilation off. In any case, no one goes past the main atrium either since no one thought of putting anchor tenants at the back. Compare this to Beijing’s, admittedly not yet perfect, Shin Kong Centre and I think you will know what I mean.

Likewise, I had always enjoyed a quiet little chuckle walking through Oriental Plaza, ‘Beijing retail, pah!’ But now I am chuckling on the other side of my face. Some excellent retailers and a good selection of F&B outlets to get people moving around, bits and pieces of building work going on here and there, a seminar going on in the central plaza, all signs of active management; more than mopping up after the dripping air conditioning.

Even Finance Street has a retail play now. Four Seasons Mall is fully leased ahead of completion and even now in its ‘not quite open’ state has the look and feel of something special. Good sight lines cunningly placed vertical transport, graceful lines and excellent materials. Not only that, but the Westin and Ritz Carlton are within walking distance of the office buildings. When did you last try walking from Shanghai’s Grand Hyatt to anywhere, let alone to the office entrance of the same building around the corner on a thundery day?

New Sanlitun, also not yet open so a bit unfair to point at them, but stunning enough in design, conceptualization and positioning. It shows flair and imagination that BigThumbPlaza doesn’t get near. Dare I say it, is this what Xintiandi was meant to be before it became an overpriced food court?

And in case you’re thinking this is just Sam prattling on about a trip to Olympic ready Beijing and a bunch of shops, remember, I’m a man; I don’t go shopping unless I have to. Next trip I’m looking forward to taking my better half.