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All types of businesses are weathering the impact Covid-19 left on their business. The retail sectors of e-commerce, B2B, B2C and brick-and-mortar brands are among the notable casualties as people adapt to the new norm of shopping online and working from home.
On top of that, short-term demand and value have worsened as businesses struggle to keep afloat during difficult economic times.
While the outlook for the office market in Kuala Lumpur remains cloudy as the gap in supply and demand widen, buildings in locations with high vehicle exposure and good accessibility will always thrive, said Maximin Corporation Sdn Bhd director David Tjhung.
“Even when market conditions are slow, the KL fringe and Selangor markets which attract a broader profile of tenants are expected to remain resilient.
“Many tenants have approached us, either for rental or inquiry during these tough times. We view the pandemic as an opportunity for businesses to enter a tightly held location, which in normal market conditions, they would not have the chance to do so.”
One example is the famous Avon headquarters in Petaling Jaya’s Seksyen 51A, which is located along the Federal Highway. The building, which is now Menara Maximin, houses the first standalone Harvey Norman store in Malaysia.
“At present, the building has just been released for lease and is already approximately 65% occupied. Demands for the building are good despite market conditions.
“Due to growth in e-commerce, it says a lot when an international brand like Harvey Norman decides to occupy half of the building in the middle of a pandemic,” said Tjhung.
Menara Maximin is a six-floor building with an approximate net lettable area of 195,000 sq ft, and the building offers various types of space such as warehouse, retail and office components. The space dedicated to the newly launched standalone Harvey Norman is 35,926 sq ft (ground floor store).
But Tjhung said many other tenants are looking for more than just space.
“It is about how much value a landlord can provide to the tenants. At Maximin, we strive to create win-win situations for all parties involved, and we view our relationship with our tenants as a partnership, rather than just a standard tenant-landlord arrangement.
“We are able to attract a wide range of tenants such as big-box retailers, logistics companies, the last mile, corporate offices, health and wellness centres and home improvement stores.”
Tjhung noted that one of the biggest selling points of the building is the exposure to one of the busiest highways in the Klang Valley – the Federal Highway.
According to the Ministry of Works Malaysia, the Federal Highway has approximately 1,366,071 vehicles passing it daily. This exposure alone will help businesses save on marketing costs and at the same time, increase their brand awareness.
“With the signage alone, any business would be able to deliver their brand awareness on a massive scale! And with signage being a permanent fixture, tenants will have 24/7 exposure to keep their business top-of-mind.
“That being said, tenants will get a return on investment compared to just paying rental at other commercial buildings by coming to this building. The number of marketing dollars saved alone will cover their rental cost,” Tjhung opined.
E-commerce game stands strong
Harvey Norman Malaysia’s lead general manager Eddy Ng told Property Advisor that during this pandemic, the company is doing well despite strong competition from other online platforms.
“There isn’t any specific right or wrong timing to open any stores. We have planned to open a standalone store in Klang Valley for quite some time, and grabbed this opportunity when we came to know about this location.”
Ng said the current landscape for the retail industry is challenging; however, essential product retailers still survived during the pandemic.
“Consumers will still prefer not only to look but also to try and feel (touch) the actual products before committing to buy. This is something online platforms can’t offer.
“Since travelling overseas is not allowed and people are spending a lot of time working from home, they tend to realise there is a need for them to upgrade some of the household items with the savings that came from not spending on trips overseas.”
This article was written by Sharina Ahmad of PropertyAdvisor.my, Malaysia’s most comprehensive source of property data, property analytics and insights.