Monday, November 12, 2007

More malls on steroids in Asia, but perhaps not where you'd expect

Megamalls in the Philippines or in Asia are hardly news, but when they are in my wife's hometown that's news to me. Taytay, Rizal is just outside Metro Manila. It is a densely-populated municipality with a population of some 200,000+. And infrastructure in places like this are not what you expect here in the US. But there's amazing development going on, and this mall was built by the mogul of all moguls in the RP, billionaire Henry Sy.

It is not someplace you'd expect to see a mall as large as many in the United States. But it is there, and it is already hugely popular. Lines of hours to buy things have been reported. And the really big big malls in are Manila!

So why build in Taytay? Because the roads are so narrow, it can take 45 minutes just to go 6 miles from Taytay (not to mention more outlying areas in Rizal province) to Pasig or Mandaluyong (where even bigger malls can be found), so Sy's theory is to bring the mall to the people. Plus, shopping is basically a pastime and with the Philippine economy improving the malls make sense in that regard. (Call centers for US companies are a big item there; you also high education levels, and just about everyone speaks fluent English). Lastly, let's not forget that the Philippine peso has improved in value against the dollar (an almost-official currency) by about 25% in the last couple of years. What was a 55:1 exchange rate is now more like 42-43. So my loss (when I travel there) is their gain, and that is all right by me.

P.S. What I forgot to mention is the construction cost! According to the story the mall cost P$1 billion. Divide that by 43 to get the cost in dollars, and then look at how much per square foot it cost to build this mall. No wonder you do it.


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