MAHB TO TURN AIRPORTS INTO RETAIL HEAVEN
Firm targeting RM600m in non-aeronautical revenue contribution by 2021
MALAYSIA Airports Holdings Bhd (MAHB) will position its five international airports in Malaysia as lifestyle and shopping destinations in the Asia-Pacific region.
The five international airports are Langkawi International Airport, Kuala Lumpur International Airport (KLIA), Kuala Lumpur International Airport 2, Penang International Airport, Kota Kinabalu International Airport and Kuching International Airport.
MAHB senior general manager (commercial services) Mohammad Nazli Abdul Aziz said the airport operator had begun reformatting the airports’ retail spaces, which would be carried out in phases.
“The reformatting works will take three to five years. Our airports’ non-aeronautical business contribution will be largely driven by high-end fashion, food and beverage and duty-free sales in the future,” he said at MAHB’s commercial reset strategy briefing, here, yesterday.
Mohammad Nazli said MAHB had begun reformatting works of retail spaces at the Langkawi airport, while the remaining airports would begin tendering in the fourth-quarter.
The airport operator is targeting more than RM600 million in non-aeronautical revenue contribution by 2021, leveraging the high-yielding product categories.
He said MAHB also expected more high-yielding product categories to increase passengers' spending at its airports.
MAHB targets to increase four times, or RM140 from the current RM35 per passenger spending, across its network of airports within five years.
He said the anticipated increase in passengers’ spending would be supported by MAHB’s retail reformatting, fuelled by retailers investments at its fit-out spaces.
“The aviation industry is going to grow at least three times in the next 10 years. Hence, the minimum retail business will also grow about three times.”
He said the non-aeronautical revenue contribution would be supported by an influx of growing middle-class passengers, particularly in Asia Pacific.
“We want to be as competitive as our regional peers. Our airports are now reaching capacity very fast with a combination of the right location, lower travel cost and cheaper ringgit, making Malaysia a sought-after holiday destination among tourists,” he said.