144 views

Travel ban from China may impact Orchard Road malls

Chinese visitors spent more on consumables compared to the average visitor.

The government’s move to ban travellers who have come from China in the past two weeks may particularly impact malls in Orchard Road, given its larger proportion of tourist visitors, according to a report by DBS Group Research.

China is one of Singapore’s key visitor source markets, historically comprising about 20% of the city’s total visitors and around 20% of the city’s tourism receipts of $10.2b.

Chinese visitors were also found to spend a larger proportion on consumables compared to the average tourist, with 51% of the receipts coming from shopping and 12% from food and beverages. This was attributed to most or 70% of them being tourist travellers.

Besides tourists, residents may potentially opt to go to a suburban mall instead.

“Consumer behaviors are already changing, especially in the near term. How many of us have decided to delay that weekend trip to downtown Orchard Road for that weekend movie date or shopping therapy but rather stay home to watch Netflix and order in our meals?” wrote DBS analysts Derek Tan and Rachel Tan.

With this, pure- play suburban landlord like Frasers Centrepoint Trust (FCT) are expected to benefit the most given its malls, like Causeway Point, Northpoint, Waterway Point, are dominant in the suburban retail scene

On 1 February, the government has ramped up travel restrictions to prevent the spread of the the novel coronavirus originating from Wuhan by banning visitors from China, including foreigners, who have been there for the past 14 days upon entering or transiting in Singapore.

This is expected to impact tourism-sensitive industries like hotels, who are already likely to be most affected by the outbreak, followed by tourist-focused shopping malls.

For tourism, the risk of a snowball effect to other travellers who may delay their travel is high. DBS is not anticipating any cancellations or delays of major meetings, incentives, conferences and exhibitions (MICE) events like the Singapore Airshow in February, but smaller conferences with a larger Chinese participation are more at risk.

Join Singapore Business Review community
Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!