Investment
Korean Lotte Center joins retail market in big way on National Day
The developers of Lotte Center may have decided to open their new shopping mall on National Day on September 2, to attract numerous visitors. However, analysts believe they chose the wrong time to open their mall.
Lotte Center, the $400 million 65-storey building, made its debut while the country is still in economic recession, and at a time when shopping malls are experiencing tough days.
For example, Trang Tien Plaza, the shopping mall located on the “golden land” in the center of Hanoi, has been closed for restructuring. Hoa Binh Green City offers free retail premises for 25,000 square meters of floor space in an effort to stimulate demand.
Meanwhile, though located on Lieu Giai street in an advantageous position, Lotte Center will have to vie with formidable neighbors, including Keangnam and The Garden.
Observers think that Lotte Center, as a “rookie” on the market, will need to run big sale promotions to attract customers.
However, they noted that the vouchers and gifts offered at the opening ceremony were not “impressive” enough to Hanoians, who have many shopping choices.
A lot of questions were raised at the opening ceremony about the advantages of Lotte Center over other rivals, but the investors refused to give answers, saying that the executive in charge of the matter was not present.
Lee Jong Kook, general director of Lotte Coralis Vietnam, said Lotte Center has a special design, solid structure and a Sky Walk, an observatory that gives visitors a view of the entire city, and a good internet system.
However, an analyst said that Keangnam, the highest building in Vietnam, which also has an observatory and modern facilities, has been deserted since its opening.
The analyst noted that there is no cinema at Lotte Center, in contrast to many malls which have one. Cinemas are believed to bring high revenue to investors.
“While shopping malls cannot attract buyers, their cinemas are always crowded,” he said, noting that cinemas in these spaces have been the main breadwinners.
Explaining why Lotte did not have a cinema, Lee said cinemas may bother the hotel’s guests and residents. Meanwhile, Lotte needs to satisfy all of its clients, who are all VIPs. However, he said the group may consider building cinemas in the future.
Lotte’s opening was a special event for Hanoi’s young people, who often access social media and can talk to each other about such openings. However, many of them said they were not as excited about the new high-rise building as they have been in the past.
Vu Tuan Duc, a university student, noted that Hanoi lacks parks, lakes and greenery for people to relax and breathe fresh air, while there are too many shopping centers.
Tran Thanh Thuy, an office worker, wrote on her Facebook page that she visited Lotte Center when it opened but does not intend to return because everything was very expensive.
However, Vu Dinh Trung, director of VietHomes, a real estate firm, noted that it is too early to say if Lotte will succeed with the shopping mall in Hanoi. He said the investors may take a loss in the short term due to economic difficulties, but they have enough resources to thrive in the future.
Meanwhile, though located on Lieu Giai street in an advantageous position, Lotte Center will have to vie with formidable neighbors, including Keangnam and The Garden.
Observers think that Lotte Center, as a “rookie” on the market, will need to run big sale promotions to attract customers.
However, they noted that the vouchers and gifts offered at the opening ceremony were not “impressive” enough to Hanoians, who have many shopping choices.
A lot of questions were raised at the opening ceremony about the advantages of Lotte Center over other rivals, but the investors refused to give answers, saying that the executive in charge of the matter was not present.
Lee Jong Kook, general director of Lotte Coralis Vietnam, said Lotte Center has a special design, solid structure and a Sky Walk, an observatory that gives visitors a view of the entire city, and a good internet system.
However, an analyst said that Keangnam, the highest building in Vietnam, which also has an observatory and modern facilities, has been deserted since its opening.
The analyst noted that there is no cinema at Lotte Center, in contrast to many malls which have one. Cinemas are believed to bring high revenue to investors.
“While shopping malls cannot attract buyers, their cinemas are always crowded,” he said, noting that cinemas in these spaces have been the main breadwinners.
Explaining why Lotte did not have a cinema, Lee said cinemas may bother the hotel’s guests and residents. Meanwhile, Lotte needs to satisfy all of its clients, who are all VIPs. However, he said the group may consider building cinemas in the future.
Lotte’s opening was a special event for Hanoi’s young people, who often access social media and can talk to each other about such openings. However, many of them said they were not as excited about the new high-rise building as they have been in the past.
Vu Tuan Duc, a university student, noted that Hanoi lacks parks, lakes and greenery for people to relax and breathe fresh air, while there are too many shopping centers.
Tran Thanh Thuy, an office worker, wrote on her Facebook page that she visited Lotte Center when it opened but does not intend to return because everything was very expensive.
However, Vu Dinh Trung, director of VietHomes, a real estate firm, noted that it is too early to say if Lotte will succeed with the shopping mall in Hanoi. He said the investors may take a loss in the short term due to economic difficulties, but they have enough resources to thrive in the future.
