Mr Hoo, who said that he is acting as a consultant for Mustafa’s overseas investments in Malaysia, told CNA that negotiating with owners of the unsold retail units is tricky due to “legacy issues”.
“They purchased these units way high … thinking they can get a return of 7 per cent (of the sale profit of the units) but you know the mall business is not able to justify the high rental. These guys have been misrepresented,” he added.
Mr Hoo added that the delays are also due to renovation and upgrading works to ensure that the mall is “usable”.
“When Mustafa and I looked at the mall, we wanted to upgrade the loading dock, make sure the lifts are operable – (that) it can hold and load big items. We basically need to improve the (functionality of the building),” said Mr Hoo.
When contacted by CNA, co-founder and managing director of Mustafa Centre Mustaq Ahmad confirmed that the target was now to open the firm’s flagship departmental store in Johor Bahru by end-2024.
“The (progress) is nothing yet, we are still planning and deliberating, it will take time,” said Mr Mustaq.
“Work to achieve (the target of opening in end-2024) is ongoing. We’ll see how it goes,” he added.
Mr Mustaq did not elaborate on issues in negotiating with some owners of the remaining retail units in Capital City Mall.
Capital World and Mr Mustaq also did not specify the number of additional retail units Mustafa wants to rent in Capital City Mall.
Ms Cassia Sia, manager of the mall’s developer Capital City, told CNA that Mustafa, as the anchor tenant, requires more retail space so that it can organise the store as it wishes.
“For instance, Mustafa may already have 60 per cent of the retail space on the first floor, but it wants to lease the remaining retail space so it can operate across the whole floor and organise it better,” she said.
“We initially hoped to reopen the mall this year but it’s already past September. So we need to execute our plan, make minor modernisation to the space so it will be ready by Q4 next year, in time for the year-end festive season,” she added.
CNA has also reached out to Capital City Mall’s management to get in touch with the strata title owners who are negotiating with Mustafa.
The 11-storey Capital City Mall, which was completed in April 2018 and opened in October that same year, is located in the Tampoi suburb, around a 15-minute drive from the Johor Bahru checkpoint.
It is also part of a freehold integrated development in Tampoi which includes a 315-room hotel, an 18-storey tower with 630 serviced suites, and 690 serviced apartments across three blocks.
When CNA visited the mall last week, construction was still ongoing at some of the stores.
Source: CNA
