Lessons for Chinese mega-mall development : a case study of the South China Mall

Abstract

China is embracing mega-mall development: Seven out of the ten largest shopping malls in the world will have been located in China by the year 2010. All the completed mega-malls are now suffering from high vacancy rates and therefore experiencing enormous economic losses. To avoid the failure of future mega-mall projects, it is important to establish rigorous guidelines for design, leasing, financing, and management of Chinese mega-malls. However, research in this field has not yet been conducted. This paper will analyze five problematic issues of the South China Mall, the largest shopping mall in the world, and describe a dynamic process involving governments, developers, and banks behind the failure of the Mall. The paper will also provide strategic suggestions on the development and management of the Mall. Given its dimensions and aspirations, the South China Mall is a mirror of contemporary Chinese mega-mall development. It is hoped that lessons from the South China Mall can be applied to other Chinese mega-malls currently experiencing economic stagnancy.