Get ready for some serious shopping @ Korat's Malls

Two massive property and retail developers, Central Pattana Plc (CPN) and Land & Houses Plc (LH), have begun developing new state of the art shopping malls in Nakhon Ratchasima to challenge the monopoly dominance of The Mall.

Central Pattana Plc has announced that it will build its 28th mall, Central Plaza Nakhon Ratchasima, in Korat city centre, at a staggering cost of 7 billion Baht. The 52 - 70 acre project should be ready to open in early 2016.

Siam Retail Developer, a subsidiary of Land & Houses Plc, and the operator of Terminal 21 and Fashion Island, have also begun to build their shopping centre in the city centre as they plan to explore business in the province, the gateway to Isan.

Businesses and retailers have been expanding in Korat for the past 10 years due to its thriving and growing economy, and since the formation of the ASEAN Economic Community, it is attracting further investors who see Korat as a great location to move into neighbouring ASEAN countries.

The whole province has huge plans to improve the infrastructure, and it won't be long until the high-speed train project that will connect Singapore to China is underway putting Korat just an hour away from Bangkok by rail. There is apparently also another double-track rail route planned for Isan, which would be great for the city.

The Mall Group, who are the second-largest retailer in Thailand, first came to the area 14 years ago, and have recently had to renovate the underground City Walk, the top floor, the swimming pool and are now redoing the Fantasia Lagoon and adding a large extension to compete with what's to come. If you sit on your laurels, you're done for. The overall renovation plans for The Mall are supposed to be 200 million Baht, so expect some serious changes.

Paibul Kanokwattanawan, chief executive of The Mall Group, said the renovations this time around are aimed at adapting to the lifestyle of shoppers. "Korat will be a red ocean market in the near future. The government’s planned infrastructure projects will likely accelerate the growth of the province," he said. "In the beginning, the new shopping centres will most certainly take customers, but in the long term there will be more room to expand."

Spending at The Mall has increased every year, but consumer buying power decreased in 2014, due to the first-time car buyer tax rebate. "Some 38,000 cars were sold under the scheme in Nakhon Ratchasima, removing 30 billion Baht from consumers’ pockets," said Mr Paibul.

With a GDP of 202 billion Baht, Nakhon Ratchasima is the wealthiest province in the Northeast, and it already has lots of shopping opportunities like 2 large Tesco Lotuses, a Big C, Index and a Makro. With e new plans, the Mittraphap Road is going to see a serious increase in traffic and The Mall is likely to see sales drop initially, until the population climbs to a figure that can sustain all this new development.

A retail analyst stated that with 2.8 million people in the province, the per capita income is relatively high at 71,405 Baht per annum with an 8% annual increase, above the country’s average growth rate.

Wallaya Chirathivat, CPN's senior executive vice-president for business development and construction management, said construction work on Central Plaza Nakhon Ratchasima will start in May and is scheduled for completion in early 2016. The shopping complex is expected to draw an incredible 50,000 - 60,000 visitors on weekdays and 70,000 - 80,000 over the weekends and on public holidays. The target market is upper-middle income earners and high earners, and with projected sales, the company expects to break even within 7 years.

Also on the Mittraphap Road about 8km away from The Mall, Ms Wallaya said the new Central Plaza will have a gross floor area of 250,000 square metres, with lots of new shops including Isan's first Central Department Store. If you have ever seen the Central in Khon Kaen, it is going to be quite an eyesore, but will certainly add to the ever increasing shopping options in an rapidly expanding city.

Ms Wallaya is quoted, "The Northeast has excellent growth potential and we have invested in several projects in strategic locations throughout the region".

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