The retail industry player’s achievement is attributed to the double-digit growth by Sunway Carnival, resilient out-of-home dining, and robust festive spending in the first quarter of 2023 (Q1 2023) across all Sunway Malls.
The mall group’s sales performance in Q1 2023 exceeded expectations with a substantial 19% y-o-y growth, before moderating in the subsequent quarters.
Sunway Malls and Theme Parks CEO, HC Chan said that Sunway Malls’ strong Q1 performance provided a huge buffer to ease the moderation in subsequent quarters.
“Throughout 2023, businesses and consumers faced escalating costs due to inflation and weaker ringgit arising from the US Federal Reserve’s aggressive interest hikes.
“Still, Sunway Malls managed to navigate both the challenging business landscape and the high base effect of 2022 to achieve a commendable 5% growth,” he said in a statement.
The growth was primarily driven by the travel, health and personal care, and entertainment retail sub-sectors’ positive performance, while the food and beverage (F&B) and fashion retail sub-sectors also showed resilience and support.
The travel-related retail sub-sector experienced the highest y-o-y growth at 28%, while the entertainment sub-sector witnessed a 15% increase y-o-y.
Demand for health and personal care improved by 11% y-o-y, and fashion retail saw a 5% uptick y-o-y, supported by robust demand during the festive period.
In the F&B category, out-of-home dining showed a remarkable 5% growth y-o-y despite persistent inflation in food and non-alcoholic beverages.
F&B has emerged as one of the top 20 sale categories in Sunway Malls, reflecting the growing dominance of F&B by occupying 25-30% of the total lettable area.
“To stay competitive and provide quality retail space, Sunway Malls is undertaking an RM550 million Asset Enhancement Initiative (AEI) exercise for 800,000 sq ft of retail space in Sunway Pyramid and Sunway Carnival, with investments of RM200 million and RM350 million, respectively.
“The quality retail space will enable Sunway Malls to cater to a variety of new and fresh offerings, including more Muslim-friendly offerings,” said Chan.
Despite having acknowledged key challenges in 2024, including tax hikes, new taxes, subsidy roll-backs, tariff hikes, persistent inflation, and geopolitical tensions, Sunway Malls remained optimistic and forecasted a 5% growth in 2024, aligning with potential external demand turnaround.
“We see this as part of a normalisation of growth towards more sustainable levels,” said Chan.
In addition to AEIs, Sunway said it is constructing two new malls. These are Sunway Square in Sunway City Kuala Lumpur, expected to be completed by the end of 2024, and Sunway Ipoh Mall in Sunway City Ipoh, expected to be completed by 2026, further reinforcing its commitment to providing quality retail spaces.