Two Malls That Remade Downtown Chengdu
Chengdu Sino-Ocean Taikoo Li and IFS may be the two templates for China's new shopping complexes. They have pushed Chengdu's commercial property upgrade to a new peak, and redefined the city along the way.
Chengdu Sino-Ocean Taikoo Li and IFS may be the two templates for China's new shopping complexes. They have pushed Chengdu's commercial property upgrade to a new peak, and redefined the city along the way.
Beside Chunxi Road and next to Daci Temple stands Chengdu Sino-Ocean Taikoo Li, a sprawl of dark-gray, Chinese-style brick-and-tile buildings. They are low and widely spaced, and every roof slopes at 30 degrees. Leave the west side of this tiled complex, cross narrow Beishamao Street, and you reach Hongxing Road, home to another large mall, IFS. Everyone remembers the plump panda on its roof, straining to climb the wall.
IFS belongs to Hong Kong's Wharf Holdings, while Chengdu Sino-Ocean Taikoo Li is owned 50-50 by Swire Properties and Sino-Ocean Land. After Wharf won this prime plot in 2007, it hoped to make Hongxing Road as busy as Hong Kong's Canton Road, home to Harbour City, the developer's most successful and best-known commercial property. In 2008, Swire Properties began talks with the Chengdu municipal government, and its idea sounded just as ambitious: "to remake downtown Chengdu."
That is how Hao Lin puts it. He is the lead architect of Chengdu Sino-Ocean Taikoo Li and a director at Oval Partnership, and he joined the project in early 2008. Oval, which also grew up in Hong Kong, once handled the integration of several Hermès stores in Shanghai and Taiwan, and has worked with KPMG on a community center.
In Hao Lin's view, Chengdu Sino-Ocean Taikoo Li, which covers more than 100,000 square meters, is more than a shopping mall. It takes in six streets and a number of preserved courtyards; the residents have moved out, but the lanes remain. At the heart of this nearly derelict neighborhood is Daci Temple, which dates to the Tang dynasty. To the west lies Chunxi Road, Chengdu's busiest shopping district. To Chengdu people, Chunxi Road has always meant downtown, though by today's standards it is "a bit dated." Its brands are mostly low to mid-range, but places like the wonton shop Long Chaoshou and Ito-Yokado still draw large crowds.
When Chengdu people talk about this downtown, a mix of old and new, they seem to speak with a touch of pride. Local newspapers and online forums call it "the golden triangle of fashion" and "totally high-end." In our taxi, when the driver heard we were going to Chengdu Sino-Ocean Taikoo Li, she recommended it warmly: "People used to shop at Yanlord Landmark. Now everyone goes to Taikoo Li. It's even better than your Sanlitun in Beijing." But ask ordinary shoppers and some will say prices here are too high. Walk out of Chengdu Sino-Ocean Taikoo Li, cross the road, and you can get a cheap bowl of noodles.
Hao Lin later explained that his team had drawn up plans for a much larger area beyond Chengdu Sino-Ocean Taikoo Li, including Nankangshi Street and Hongxing Road, and had discussed them with the government, but much of it has yet to be carried out.
This seems to be a common problem in old-city redevelopment: planners see not a whole district developing but a set of scattered outposts. Consultants and experts brought in by the government once suggested that Hao Lin turn the Chengdu Sino-Ocean Taikoo Li site into another Kuanzhai Alley, or another Shanghai Xintiandi. But those models no longer suit what tenants want. Today they need more space and a more conspicuous presence.
As the gateway to China's southwest, Chengdu carries real commercial weight, yet before 2010 it never had a shopping center to match. Before IFS and Chengdu Sino-Ocean Taikoo Li, there were only long-established department stores such as Parkson, Ren He Spring and Maison Mode, along with a few old Japanese-run department stores such as Isetan and Ito-Yokado. Only after 2010 did international mall brands such as Yanlord Landmark and Raffles City arrive. Then in 2014, IFS and Chengdu Sino-Ocean Taikoo Li, one street apart, opened one after the other, and pushed Chengdu's commercial property upgrade to a new peak.
When IFS opened at the end of last year, we reported on how Wharf arrived with a large group of luxury brands opening "first stores in central and western China" and "flagship stores in the southwest": of its 300 tenants, more than 90 were brands entering Chengdu or the southwest for the first time. The same happened at Chengdu Sino-Ocean Taikoo Li, except that, because it had to accommodate historic buildings, it laid out its brands as an open-air district in two layers, "fast" and "slow."
"Fast" and "slow" are, of course, Chengdu Sino-Ocean Taikoo Li's own terms. As a shopper, this is what you see. Around Daci Temple, luxury brands such as Hermès, Gucci and Cartier stand in a row facing the road, along with fashion brands such as Zara and Muji. Many occupy an entire building, and you cannot miss them when you drive past. Further in, the back lanes hold bookstores and independent design and lifestyle brands, mixed in with restaurants, much like shopping in a small European town. If you head for the subway from here, you pass the basement-level cinema, along with bakeries, cream-puff shops and all sorts of small eateries.
"With a typical mall, your overall impression is that it is very high-end. The most upscale brands sit on the lowest floors, and each floor above gets more mass-market. But we did it horizontally. West Lane, East Lane and Central Lane run in parallel, and the fast and slow zones are linked by the simplest possible straight-line route. West Lane has the luxury brands. East Lane has lots of trendy, energetic brands, things young people like and can afford. Between them runs a street, Central Lane, between Gucci and Zara. On that street we created a gradient, with independent designers and creative brands. So high-end, mid-range and affordable brands sit side by side, and you never feel that this place is too lofty for you," said Hong Tao, former marketing director of the Shanghai Xintiandi project and manager of the agency that handles leasing for Chengdu Sino-Ocean Taikoo Li.
Shopping here is little different from shopping in Shanghai, more than 2,000 kilometers away, or even Hong Kong. It follows the standard formula: use fast fashion to bring foot traffic to the luxury brands, and use the experiences offered by lifestyle brands to soften the emptiness and monotony of a spending spree.
"In a shopping center, people buy things, eat, work out, meet friends, read, watch films, see exhibitions... You find that almost all of these activities can be sorted into 'fast' and 'slow.' So we came up with the idea of a district for 'fast fun, slow living,' and used it to organize the space. The aim is to keep everyone here and give them a richer, more varied experience," Hong Tao told QDaily.
Han Zhi, general manager, director and head of property operations at Chengdu Sino-Ocean Taikoo Li, told QDaily that the decision to make the complex an open, experience-driven district owes much to how Chengdu people live and spend. People in this city love to "have fun" (shua), take life easy and care about food and drink, with an unusual devotion to life's small pleasures. Even a noodle shop barely a square foot in size may have a mahjong table set up out front, and people like to stand on the street "watching passersby" (dawang), with or without anything else to do. Chengdu people have always relaxed and amused themselves in outdoor spaces such as streets and courtyards.
"The climate here is not really suited to an open-air shopping street. It rains much of the year, and it is humid and muggy. But that is exactly why Chengdu people don't like staying indoors. As soon as the sun comes out, everyone rushes outside to drink tea," Han Zhi said.
Although the two are not direct competitors, Chengdu Sino-Ocean Taikoo Li and IFS have settled into a subtle difference. The former leans toward lifestyle; the latter makes it easier to shop, shop, shop. Chengdu Sino-Ocean Taikoo Li's tenants include many experience-driven businesses: the Muji global flagship store, four floors and more than 3,000 square meters, and the first in China with a Café & Meal; a Starbucks Black Apron store offering hand-poured coffee; Fangsuo, which combines a bookstore, café, art gallery and clothing; Wuxin, which curates design products, stationery and books; Häagen-Dazs's second bar-concept store, after Shanghai; and ABC Cooking Studio, Japan's largest cooking school.
Nearly 300 brands have moved into Chengdu Sino-Ocean Taikoo Li. Retail makes up the largest share at 66%, dining about 20%, and lifestyle and leisure about 10%. "We settled the dining leases first, a lesson we learned from Xintiandi. Chengdu people love to eat, and Sichuan food rules supreme here, but we brought in only one Sichuan restaurant, because we felt people come here to taste food from around the world. So we have popular Hong Kong and Taiwanese brands such as Zhengdou, Cuiyuan and Din Tai Fung, creative Western restaurants such as Blue Frog and Red Mailbox, and Japanese, Thai or lighter, healthier restaurants such as Xiaoshan, Lian, Element Fresh and Jishi," Hong Tao told QDaily.
When IFS opened, it offered very attractive leasing terms to keep the big luxury brands and persuade more brands to move in. According to industry insiders, some malls charge brands a guaranteed minimum plus a percentage of sales, and the percentage is usually at least 10%. Chengdu's IFS offered many brands 8% or even less. Generous fit-out subsidies also explain why the brands' flagship stores look so lavish.
Chengdu Sino-Ocean Taikoo Li did much the same. To attract big-name and popular brands, it offered them even better terms in negotiations, on location within the complex and even on store fit-outs. "We upgraded and redesigned the spaces of many of our retail partners," Han Zhi said. In an earlier interview with another outlet, he recalled that early in leasing, many brands rejected the "open district" proposal the moment they saw it, believing it had little chance of success. Chengdu Sino-Ocean Taikoo Li "did painstaking layout studies for 300 stores" and eventually won the brands over.
"I told them: we are building these stores with steel frames precisely so that you can open a flagship here. Which store should go where, what its strengths are, how to make up for a weak location—nobody knows that better than I do."
That is how the Muji global flagship came about, billed as the first in China and Muji's largest store outside Japan. As the biggest anchor in East Lane, it was given the street-facing entrance. Reportedly, when Masaaki Kanai, Muji's fourth president, came to Chengdu and took one look at the new site that Daci Temple and Chengdu Sino-Ocean Taikoo Li had picked for it, he immediately scrapped the original plan and expanded the store to four floors, today's 3,141 square meters. That is nearly the size of Muji's largest store in Japan at the height of its success.
Unlike Muji's standard stores, the Chengdu flagship was designed personally by the Japanese interior designer Takashi Sugimoto. Each floor has its own art installation, and a large transparent cube is divided into small units with different themes.
The huge store displays more than 5,000 products, nearly everything Muji wants to show Chinese consumers, including Café & Meal MUJI, making its debut in China, and the popular Japanese home brand IDÉE. Products such as bicycles and air purifiers were also chosen to launch here.
The most prominent spot on the first floor goes to the products that sell best in China, such as aroma lamps, hard-shell suitcases and skincare. But what most sets the Chengdu flagship apart is that it does more than sell goods: it is a showcase for Muji's philosophy and aesthetics. The store has professional consultants in interior decoration and clothing coordination who advise customers on furnishing their homes and on personal style.
The biggest draw, which Chengdu's young arty crowd lines up to try, is Café & Meal MUJI on the third floor. It offers set meals of 3, 4 or 5 dishes, the number being how many items of food you get, priced at 68, 78 and 88 yuan. The dishes follow the recipes used in Muji's Japanese stores, but the ingredients come from reliable local suppliers. One dish with a Chengdu flavor is pork ribs steamed with millet, which a Japanese head chef developed while touring China in search of local food.
Looking beyond Chengdu, the pairing of Chengdu Sino-Ocean Taikoo Li and IFS may be a standard template for China's new shopping complexes. In a market that does not yet understand luxury brands well, a huge flagship store is in effect a giant advertisement: the more fully it expresses the brand, the more readily shoppers come to aspire to it. At the same time, shoppers who are at home with e-commerce are very clear-eyed about value for money. What they want offline is the experience online shopping cannot give them, and all kinds of new sensations.
On both counts, Chengdu residents and visitors alike will welcome places like these. Even if they only look around and then cross the street for a bowl of noodles, one day they will come back for a purchase they have long been planning, quite possibly a baking class or a hand-poured coffee course.
This may be something Kuanzhai Alley cannot achieve. The city center belongs to locals. Behind its faux-antique facades, Kuanzhai Alley lacks the brands that would tempt locals, so it can belong only to tourists, the only people who still find some interest in its architecture, and even that interest probably won't last long.
According to a CBRE report, IFS topped Chengdu's mall sales rankings in 2014, with retail sales of 2.1 billion yuan for the year. That was nearly 500 million yuan more than the 1.62 billion yuan of second-place MixC, a gap equal to the sales of the entire Isetan department store on Chunxi Road. And according to JLL, by 2017 Chengdu will have about three times as many shopping malls as it does now, with Intime, Joy City, Guomao and others on a long list waiting to open. By then, downtown Chengdu may be rewritten once again.
Wandering around Chengdu Sino-Ocean Taikoo Li, we noticed that the neighboring block still holds a small patch of the original apartment buildings. Slightly shabby and in stark contrast with Taikoo Li, they nonetheless give off a feeling of "this is the real Chengdu." Demolition and redevelopment may await them; well before 2017, this little area may be gone.
Translated from the original QDaily article. Original publication date retained.