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Myanmar, Japan to develop new large-scale shopping mall in Yangon

Local real estate developer Shwe Taung Real Estate Co Ltd and Japan’s Aeon Mall Co Ltd have formed a joint venture to invest, develop, manage and operate large-scale shopping malls in Myanmar, both companies announced on August 4.
The JV received approval from the Myanmar Investment Commission last week. Shwe Taung holds a 30 percent stake in the joint venture, Aeon Mall Myanmar Co Ltd, while Aeon Mall will hold the remaining 70pc.

The first Aeon Mall Myanmar shopping mall will be developed in Dagon Seikkan township, Yangon Region. Construction will begin in the middle of next year and the mall will open in 2023.

The US$180 million shopping mall will be developed on a 17.6 acre plot at the corner of Shwe Li Road and Ayeyarwun Road in Dagon Seikkan. The 5-storey shopping mall will house 200 specialty stores across a gross floor area of about 1.2 million square feet. There will be 2,300 carpark lots. Aeon General Merchandising Store (GMS) has committed to being the anchor tenant.

In operating the first Aeon Mall in the country, Aeon’s global market and retail expertise will be complemented by Shwe Taung’s tenant and mall management expertise in Myanmar. The joint venture plans to invest in the development and operation of more new malls in Myanmar moving forward. A subsidiary will be set up to handle development of the first mall, including leasing, management and operations.

The agreement between the largest shopping mall operators in both Myanmar and Japan is expected to raise the shopping standards and lifestyle experience in Myanmar to a higher level. This, in turn, will generate new demand and pave the way for higher-end shopping options in the country and draw further investments
and competition.

In a statement, Daw Sandar Htun, CEO of Shwe Taung Real Estate, said the JV with Aeon Mall will “bring fresher and more innovative retail and lifestyle concepts to Myanmar.”Mr Mitsugu Tamai, Managing Director of Aeon Mall, added that his firm’s shopping mall development knowledge and experience will enable it to provide more
innovative, higher-end shopping options for Myanmar consumers.

Aeon has a portfolio of 172 Aeon Mall-branded malls in Japan and worldwide. It is expected to bring fresh retail concepts like the Aeon GMS and other suitable Japanese brands offering entertainment, pet care and modern lifestyle products and services to Myanmar for the first time. Meanwhile, Shwe Taung is the largest shopping mall owner, manager and operator in Myanmar with a portfolio of 6 Junction shopping malls comprising more than
1 million square feet of retail space. Junction introduced the first modern shopping mall concept to Myanmar in 1999.The move comes in spite of the ongoing COVID-19 pandemic and on the back of longer term prospects for the retail sector in Myanmar. In April, Siam Makro of Thailand’s Charoen Pokphand Group had also opened the Makro Myanmar hypermart near Mingalar Taungnyunt township in Yangon.

According to EuroCham’s Consumer Goods Guide 2020 released early this year, modern retail stores currently account for approximately 10pc of the country’s retail market and this is expected to increase to a 25pc by 2020, Supermarkets and convenience stores are increasingly being established in the larger cities of
Myanmar to cater to changing consumer behaviours and preferences.The guide also revealed that out of approximately 250,000 retail outlets in Myanmar, grocery, convenience, fabric, pharmacy and fashion are the top five outlet
categories, together accounting for 45pc of total retail stores. It noted that both local and international retailers are optimistic about future growth potential.

The Ministry of Commerce permitted more than 30 foreign retail and wholesale businesses to operate in the domestic market between July 2018 and December 2019. The ministry also permitted joint ventures of retail and wholesale businesses between foreigners and citizens.

The government first opened up the wholesale and retail industry to foreign investors in May 2018, permitting fully foreign-owned companies as well as joint ventures between international and domestic investors to carry out retail and wholesale businesses in Myanmar.

Since then, foreign retailers and wholesalers of consumer goods, foodstuff, household products, pharmaceutical products, machinery, construction material,
agricultural products and electronics have entered the market. These include MyCare Unicharm from Thailand, DKSH from Thailand, Unilever from Netherlands
and Nestle from Switzerland.

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Source : Myanmar Times

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