17 December 2021
Malaysia Airports this week launched a tender exercise covering 226 commercial outlets in the last phase of its wide-ranging ‘Commercial Reset’, which began in 2018. The group said it aims to attract “both local and global players to participate in offering new brands at the airports nationwide”.
The tender drive covers retail, food & beverage and services at Kuala Lumpur International Airport, low-cost terminal KLIA2, Penang International Airport, Langkawi International Airport, Kuching International Airport, Kota Kinabalu International Airport, Melaka Airport, Alor Setar Sultan Abdul Halim Airport, Kuala Terengganu Sultan Mahmud Airport and Ipoh Sultan Azlan Shah Airport.
Retail categories covered include P&C, confectionery, destination merchandise, fashion, electronics, convenience and pharmacy items. F&B categories for which there are opportunities include fine dining, bakery/delicatessen and grab & go. Service concessions include excess baggage, sleep lounges, telecoms, business centre, bag wrapping, porter services, travel connectivity services and a medical clinic.
Malaysia Airports said the move to tender these space now followed a recent improvement in air traffic volumes as restrictions have been eased. A ‘travel bubble’ for foreign visitors has been established at Langkawi International since 15 November and a Malaysia-Singapore Vaccinated Travel Lane (VTL) opened on 29 November.
While international traffic remains relatively low, domestic passenger numbers in Malaysia reached more than two million last month, the highest volume recorded in any month since March 2020, although this was still half of November 2019 traffic.
Malaysia Airports Managing Director Dato’ Iskandar Mizal Mahmood said: “Pre-COVID-19, the non-aeronautical segment made up about half of the group’s total revenue. In 2019, 47% of total revenue was contributed by this segment which included the commercial and retail business.
“The Commercial Reset initiative was identified as mission critical, and its implementation continued despite the impact of the pandemic to the group’s financial performance. We wanted to ensure that we are ready to welcome the return of passengers with exciting new retail offerings and experience, hence we welcome the participation of both local and global brands to help realise our Commercial Reset objectives.”
The Commercial Reset is one of the pillars of group strategy. It aims to position Malaysia as a preferred global destination by building airports on a “sustainable, relevant and competitive” basis. The strategy aims to raise the commercial profile of international airports in Malaysia through real estate improvement, brand positioning improvement, Sense of Place allied to new tenant and product mix.
For this tender, two tender briefings, one each covering retail and F&B, will take place virtually on 22 December. Proposals are due by 21 February 2022.
Airports across Malaysia feature a total of 808 commercial outlets, with around 70% of these previously tendered and most contracts awarded.