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Shopping Centers Today -> May 2002
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STARMILLS OPENS IN PHILIPPINES; MORE ON THE WAY
By Dave Bodamer
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| StarMills’ developer expects 2 million visitors a month in this underserved secondary market. |
Political unrest and the lingering Asian financial crisis have not stumped retail development in the Philippines. That is evidenced by the 700,000-square-foot Robinsons StarMills regional mall that opened late February in San Fernando, a northern city about 70 kilometers (43 miles) from Manila in the Pampanga region.
“The so-called political crisis is a way of life in this country,” said Medardo T. Cadiz, president of Makati City, Philippines-based Cadiz International, the project’s architects. In the latest episode of the country’s turbulent history, more than 600 U.S. ground troops are helping the Philippines battle Abu Sayef, an Islamic group linked to Al Qaeda.
“Nobody pays attention in the north to a degree that’s significant,” Cadiz said. “Put it this way: It would be like if a New Yorker stopped going to Macy’s because of something happening in Alabama.”
Robinsons Land, the Quezon City, Philippines-based developer of StarMills, said there was a dire need for a regional mall in San Fernando to meet untapped consumer demand. Given a local population of more than 1 million residents, the company said it has the critical mass it needs to sustain a regional mall development.
“It was built primarily to respond to the malling needs of the Pampanga market, who are reputed to love the finer things in life,” said Frederick Go, COO of Robinsons Land.
A 120,000-square-foot Big R hypermarket anchors the mall at one end, an 80,000-square-foot, two-level Robinsons Department Store stands at the other, and the developer owns both.
Robinsons Land is a major real estate corporation that builds offices, hotels and housing as well as retail space; it has built nine other shopping centers. The company includes the department store, hypermarket and movie theater facilities it owns in its malls.
Among StarMills’ major attractions are a six-screen Movieworld cinema, a bingo hall, a Home Depot-like hardware store and a 500-seat food court with 10 vendors. Robinsons anticipates that 2 million shoppers will pass through the center each month.
The project is one of a handful of major retail developments to be built in a secondary market away from Manila, the nation’s capital city. About 85 percent of the country’s existing development is clustered within Manila itself and the nearby suburb of Makati.
Getting StarMills built, even at a location the company felt was ideal, took time and effort. Robinsons conceived the project in 1996, but it took three years to find the right concept before any work could begin. And the financial crisis didn’t help.
StarMills’ developers believe that the project will draw shoppers from provincial small towns and villages within a 75-mile radius that have not previously had access to the kinds of retailers the center will feature.
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Neither have the locals seen this kind of retail format. The center, one side of which faces the mountains while the other looks back toward the main city, features large atriums at each end — the Plaza Robinson and Plaza Arayat — that pay homage to Filipino culture and architecture. One section, for instance, features special lanterns manufactured in the region.
“Everyone in San Fernando and other cities in Pampanga is proud to be [a denizen] of the city of star lanterns,” explained Cadiz. “It’s where the best Christmas star lanterns are designed, made and sold to all parts of the Philippines.”
Hundreds of villages participate in the annual Lantern Festival, devising new designs in a competition organized around the tradition of the star of Bethlehem. The mall will play host to a lantern parade of its own each year.
The exterior of the mall is lined with outdoor cafés and markets that are also accessible from inside. Overall, 16 restaurants line the mall’s exterior, creating a dining environment unlike anything else in the region.
“The region’s vibrancy was captured through the use of rich, vibrant colors for the exteriors and interiors, huge sunbursts of leaves in deep green and warm ochre on the exteriors, and themed nodes highlighting the natural landscapes and seascapes of each neighboring province,” Go said.
The mall also has six entrances, each representing a different geographical region of the country, and a lighthouse behind the building features observation decks for viewing the nearby mountains.
As a next step, Robinsons plans to expand the site with residential, hotel and office developments within the next few years.
StarMills is not the only collaborative project in a secondary Philippines market for Robinsons and Cadiz. The companies also recently opened the 500,000-square-foot Robinsons Place Iloilo, located in the city of Iloilo in the southern part of the country. Among projects by other developers are a 600,000-square-foot mall that opened two years ago, also in Iloilo, and the 500,000-square-foot Greenbelt shopping center development outside Manila, slated to open this summer.
There is also the expansion of Araneta Center, Manila (SCT, April 2001), a massive mixed-use project covering 86 acres under redevelopment by Jorge L. Araneta. The site, which already features the 700,000-square-foot Ali Mall, another 650,000-square-foot shopping center, an open-air farmers’ market and the Araneta Coliseum, will be doubled in size. The coliseum was the venue for the Oct. 1, 1975 “Thrilla in Manila” boxing match between Muhammad Ali and Joe Frazier.
Robinsons plans to open seven or eight more malls by 2004. None, however, will be as ambitious as StarMills, Go said, noting that sites and markets the size of this one are few and far between.
This development program is emblematic of the Philippines’ recovery from the so-called Asian flu, the economic slowdown that swept Pacific Rim countries in the late 1990s.
“We are starting to see positive signs of recovery in the retail sector, and we wanted to be positioned right as the market rebounds,” said Go. “The consumer market in Manila is very strong, keeping most of the premier malls there busy. But there is also a surge that started in 1999 and is continuing to go strong in other regions.”
According to numbers from the Philippines National Statistics Office, the retail industry is robust and considered to be a major growth driver in the country. The retail segment is expected to grow 20 percent in 2002, with sales exceeding $33.5 billion, compared with $27.3 billion in 2001. That growth is expected to be helped in part by the Philippines Retail Trade Liberalization Law that went into effect in late March. The law allows for the first time 100 percent foreign ownership of retail establishments in the country.
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