Aeon is building shopping centers across China, targeting middle-income families that travel by car to shop in suburban areas. The Japanese retail giant launched its first Chinese shopping center in a Beijing suburb in November 2008. Currently operating 4 shopping malls in Beijing and Tianjin, Aeon plans to increase
Aeon is building shopping centers across China, targeting middle-income families that travel by car to shop in suburban areas.
The Japanese retail giant launched its first Chinese shopping center in a Beijing suburb in November 2008. Currently operating 4 shopping malls in Beijing and Tianjin, Aeon plans to increase the number of locations to around 20 by the end of fiscal 2016 by expanding into Hubei, Guangdong, and other provinces.
A roughly 180,000 sqm shopping center is scheduled to open in Wuhan, a Hubei Province city with a population of around 10 million, in fiscal 2014. Another site, in Guangzhou, which has a population of around 13 million, will have 170,000 sqm of space.
General merchandise stores hawking lower-priced items have struggled in China as real estate prices in central metropolitan areas soar and online shopping proliferates. U.S. behemoth Wal-Mart Stores shuttered a dozen or so Chinese locations in 2013.
On the other hand, automobile ownership has surged, topping 120 million vehicles in 2012. Aeon will develop shopping malls in suburban areas where rent is relatively cheap, betting that families will drive to these locations. The shopping centers will feature restaurants, movie theaters, financial services, and kid-friendly facilities with total floor spaces of around 200,000 sqm.
Aeon's total Chinese investment in fiscal 2011-2013 is expected to reach around $683 million, but will likely surpass $975 million in fiscal 2014-2016.