GLOBAL real property services company Colliers International Philippines said with Bacolod City as one of the major retail destinations in the Visayas, local malls have thrived amid competition.
Colliers reported on April 16 that as of the end of last year, the city's retail stock reached nearly 318,000 square meters.
The lone super-regional mall in the Negros Occidental capital city is operated by the national developer SM Group.
For SM City Bacolod alone, Colliers said its north and south wings offer a combined 107,000 square meters of leasable space.
The mall accounts for more than 30 percent of the city's retail space, it said.
“Accounting for the remaining 65 percent is the smaller district and neighborhood malls owned and operated by local developers,” it added.
Ayala Land Inc. (ALI) is building a 70,000-square-meter mall within its Capitol Central township.
Expected to be completed this year, the development is surrounded by the Provincial Capitol and various government agencies.
Colliers is seeing another potential consumer traffic coming from key establishments such as Negros Museum, Hall of Justice, and a number of churches and hotels.
The Northill Town Center of property giant Megaworld Corporation, a horizontal retail development that will feature a central plaza that will host many amenities, is another huge development up for opening possibly next year.
Moreover, the firm sees about 140,000 square meters of new retail space being added to the city's stock over the next three years.
By 2020, Colliers projects the city's retail supply to reach 462,000 square meters, higher by 43 percent than 2017 stock.
In terms of vacancy, it recorded a marginal rise in the city's vacancy as of the end of last year.
Colliers reported that from 1.7 percent in second quarter of 2017, the city's retail vacancy slightly increased to 2.3 percent by the end of the same year.
“We attribute this to the recently-opened neighborhood malls' difficulty in filling vacant space,” it said, adding that “we expect Bacolod City’s vacancy rate to hover between 1.5 percent and three percent this year as we see additional take up from foreign retailers planning to occupy space in SM City Bacolod and improved absorption in recently opened nearby malls.”
The global services company, however, said vacancy should rise to between four percent and six percent per year from 2019 to 2020 given the additional space in major townships by ALI and Megaworld.
Colliers said it has observed that despite the influx of foreign retailers and establishment of a major SM mall, homegrown food and beverage brands and old retail shops operated by local developers continue to thrive.
“We attribute this to the local operators' implementation of an integrated purchasing system among their outlets, extension of exclusive credit lines and loyalty programmes to Bacolod residents and their fondness for 'tiangge' or sale items,” it added.