Tropical Mall grows rental income with less space
Published:Sunday | January 22, 2012 | 12:00 AM
Avia Collinder, Business Writer
The corner block renovation at Tropical Plaza in St Andrew has reduced the amount of available space for rental in that section of the complex but is said to have doubled income.
Norris Clarke, the manager of Tropical Plaza, said the complex should recover the US$600,000 (J$52 million) invested within two and a half years from rental income, assuming all eight shops are occupied.
The build-out has added eight new stores to the units owned by Lee Issa across the plaza. Two of the new shops are yet to be rented.
The new enclosure with its own walkway is called the Tropical Mall.
"It's a mall within the plaza," Clarke said. Clients include international brands Payless ShoeSource with two stores and adidas with one store, as well as Puzzles Corporate Cottage, a small boutique store which specialises in corporate wear; health food store Proactive Lifestyle; a kiosk selling sunglasses and other accessories.
Space has also been reserved for a fast-food restaurant with whom negotiations are ongoing, said Clarke, who did not name the company.
The new shopping space is inclusive of public restroom enclosure which Clarke says is "State of the Art". The project, completed in 2011 included steps, staircases and ramps.
Income more than doubled
Tropical Mall covers 12,500 square feet of rental space, reduced from the 15,000 square-foot block previously rented to supermarket chains and furniture stores - representing a 17 per cent reduction in space.
However, rental income which ranges from US$20 to US$25 per square foot has "more than doubled", said Clarke, noting that occupants of the original, single space had negotiated lower rates than that which prevailed in the general plaza. The space was last occupied by Khemlani Mart ahead of the renovation.
"It has improved the shopping experience and value of the plaza a hell of a lot more," said Clarke, who declined to disclose the last valuation on the shopping complex located on Constant Spring Road.
Ahead of the expansion, Issa owned 16 of then 24 shops - including his own proprietary store, Lee's Fifth Avenue - as well as the car park, which has a separate title.
The original space hosted a number of businesses that needed expansive operating space. The last three of these were supermarkets and a furniture store.
"After the last tenant moved, we got quite a few offers, but they were people asking for space ranging from 1,000 square feet to 3,000 square feet. That was what was in demand. Now, the rental income is significantly better," said the plaza manager.
Clarke said at project start that the management of the plaza was looking for enterprises which would act as magnets to other shoppers in new market segments, and would be avoiding jewellery and clothing stores, and pharmacies.
"There is no sense in bringing in more competition, for clients already operating in the plaza." We are trying to create a better shopping experience," he said then.