Developer views over the coronavirus pandemic, featuring Lien Nguyen – TCR Manager of a shopping mall in Ho Chi Minh

TCR Manager, Lien Nguyen, came to the podcast this time and joined host Hoang Anh to talk about the views of retail developers (shopping mall developers) to the coronavirus pandemic in Vietnam. 

In this podcast, Hoang Anh and Lien Nguyen dig into the current situation of retail shopping centers in Vietnam and discuss about the plan in the future for shopping malls:

In this episode Hoang Anh and Lien discussed: 

  • Lien Nguyen’s current position
  • What did happen to Lien’s shopping mall and when did the virus hit them
  • Rumor on shopping mall’s slow reaction to help the tenant
  • How other landlords reacted
  • What Lien Nguyen’s mall did and what their plan

Resource Mentioned: 

  • Article: Financial impact of COVID-19: What retailers and landlords can do

https://www.icsc.com/news-and-views/icsc-exchange/financial-impact-of-covid-19-what-retailers-and-landlords-can-do

Transcript: 

Hoang Anh: 

Hi everyone! I am Hoang Anh – founder of retail-secret.com. Welcome to my first ever podcast. If you follow me for long enough, you may remember that I mention doing a series about interviewing with experts. I did my first interview blog about former Gogi House brand Director of Golden Gate like a couple of weeks ago. This time I will do a little bit differently by interviewing online. I am so excited to introduce you to my very best friend and also a TCR Manager of a high-end shopping mall in Ho Chi Minh City – Lien Nguyen. Heyy Lien! How are you?

Lien: 

Hi Hoang Anh, luckily, I’m still alive.

Hoang Anh: 

As you all know, the coronavirus pandemic now is a hot topic all over the World. Today me and Lien, we will discuss the view of retail developers over this issue. Before we start, can you help me to introduce a little bit about yourself for the audience? 

Lien:

Sure. Hi everyone! I am Lien. I have been working as a Tenant and Customer Relations Manager for over 3 years (or you can call like TCR Manager). And before that, I was a commercial leasing consultant for about 2 years at Novaland Group. So it’s about 5 years’ experience in the retail industry.

Hoang Anh: 

Can you discuss more about your job? I think that most the audiences don’t know what a tenant and customer relations manager does I think?  

Lien: 

We call in short, TCR. For more clarification, it’s like a command center to connect tenants, customers to the central management of the mall. Everything happens to the tenant’s operation or customer experience; we will need to handle it and to make sure everything goes on right direction. For example, if you are a tenant and you are just entering the mall, there will be so many things to go through and TCR will guide you to make sure that you comply with the center’s rules. Or you are a customer and you have a bad experience at the mall, you come to Customer Service and we are going to handle it for you. The purpose of TCR is to ensure all information will be delivered on time and to the right person in charge. It’s very interesting job since I am like standing in the middle of all parties and trying to connect them all for the best relationship.

Hoang Anh: 

Uhmm humm…Yes, it’s what she does. I know this girl from 2009 but we weren’t close until 2013 when we did the capstone project together before getting out of colleague. We were in a same team at that time with another member. Jeussss, I cannot remember how many times we got fights and scream on each other to protect our own thoughts. But it was a good time and we did the best. We got the first place with the highest score ever. Do you remember that? 

Lien: 

As just yesterday! I thought that I was very lucky back then and even now, when we are best friends, living in the same city, both working in the retail industry so we have many things to shared and learn from each other. We can listen to each other as well. Since in retail, only people really into this can understand each other. And I can say, it’s not because Hoang Anh is my best friend, but she is really passionate about retail and working with her heart. So I’m more excited and pleased when she asked me to join her first podcast.

Hoang Anh: 

Oh thanks, dude! It’s my pleasure as well. So back to the main topic today, we are now in a crisis time ever in the history. The conoravirus now is driving down basically all businesses. Most of the malls are closing, except for the supermarket. Can you tell me how it happened with your mall and when did it hit? 

Lien: 

It’s like a long nightmare and we still not yet wake up. To be exact, we have been temporarily closed since the 28th of March following the instruction from the government. Up to now, with the current situation, we are not sure when we can reopen but we do hope as soon as possible. 

Hoang Anh: 

Yea yea right … No one knows actually…

Lien: 

To recall, we all heard about the news of the virus by the end of January. But its Tet time, so we were not really thinking of the impact yet. Even the first week oh first 2 weeks of February, the traffic still stable, as we all know after Tet is low season, so we don’t expect an explore. But just like suddenly, 2 last weeks of February, it started to drop the footfall, and then in March, it hit us strongly – 30%, 40% and 60% of traffic and sale dropped. I took the pictures in Mall every day to see the trend and believe me, there is nothing worser than seeing every tenant step-by-step shutting down. We are all suffering. 

Hoang Anh: 

You know what? I got a complaint about your mall the other day on Facebook about the rental fee. It was one of your tenants and I think it’s better to keep them anonymous. It was a long post and they said you guys are too slow to take any action to support tenants. They were comparing you with the shop house’s landlord, who took an action right away to reduce the rental price. What do you think about it?

Lien:

 Actually, we got the information right away when it happened. But we don’t want to back and forth on social media. We prefer an official meeting on the table and we still keep in touch will all tenants relating to any concern from them. There are always 2 sides of the story. We are all in the situation that we have never been through before, and we have to face up with so many difficulties, but I don’t think tenants are aware of it and somehow, they think we don’t do anything. But in fact, since we heard about the news of virus within Tet time, our operation is highly aware of the safety experience for the customer by prepare the hand sanitizers and increase the cleaning of public area. We request all the staffs wearing facemasks as well as reports about their health and movements. At beginning of the February, we started to review and consider the cost and fee of the Mall as well as for tenants. There are so many issues relating and it takes time; we need to be careful. Either tenants or Landlord, we are all the same situation and criticize anyone in this situation is unfair. But we all understand that the pandemic scared people, so hope everyone can take a deep breath to keep calm.

Hoang Anh: 

I can understand your point of view as I work for the landlord side as well. I think everyone and tenant are a little bit misunderstanding or I would say they don’t know what we are taking now. I remember the 1st infected case in Vietnam was the middle of January. At that time, it wasn’t this serious and nearly Tet Holiday. People were still going out and buying stuffs. It hit to tenants in February. I got my first letter from a tenant on Valentine’s day. It has never happened before and most of the landlords are so shocked I would say. 

Lien:

The entire World got shocked. At first, we thought we can control it and it’s going to end soon. Apparently, we don’t see any signs for it to end but become worst and worst. Even in a daydream, we had never thought it would be one day we had to close the mall. You know what, recently I walked along the Mall, thinking of how come It’s like that and I don’t know what will happen at the next minutes. The first time since I have been working here, like at 3 pm, in a weekday, the Mall is dark, and quiet. 

Hoang Anh: 

Yea I remember your picture on Facebook story. It’s so sad to see it. 

This one is a lifetime experience. I tried to call everyone – landlords and tenants to see how were everyone doing. It’s quite a big mess. Only Vincom had the 1st reaction to protect tenants by reducing the rental fee on the 5th of March. For my company, we took the whole of February to watch the news and hoped it will be better. 

Before the social distancing announcement from the government from the 1st of April to the 15th of April, we cut down 30%-40% rent for tenants on March but now, it should be more as malls have to be closed. Our BOD decided to take a month by month decision to support tenants. Other developers either took 20% to max 50% discount for their tenants. Some of the shop house’s landlords did it better to give their tenants to free of charge. 

Lien: 

As a company, a big system, every movement needs to be careful and certain. Honestly, from the very start, to remain operating of the mall, we had to consider deferring payment of rent for tenants as our support and sharing difficulties with them. Then based on the performance of tenants, we gave the rent discount. But every step must have a deadline, we cannot say we will support until this crisis ends because we don’t know when, but we still strictly observe and calculate the situation to see how we can give more support to tenants. On the other hand, we need to calculate our costs as well. Foresee the worst situation, we still have a lot of costs to remain even when closing the mall, like maintenance fee, security, labor cost, cleaning… We are trying and trying, just like a battle, we need to know our ability, our strengths, and weaknesses before we fight. We all need to win, we cannot lose.

Hoang Anh: 

I think you guys did a great job and on time. For the financial consideration, it shouldn’t be in any rush. Like from my side, we take a slow reaction as well to consider how much to support for tenants, but we haven’t asked for the payment since February. I sent request payments because it is a procedure, but we don’t push tenants too hard on paying for next quarter. Everything is still in consideration. 

I don’t know about your company, but I do know most of the developers that they don’t spend their own money to build the shopping mall. They took debts from the bank. As long as you have debts, you have to pay it back. There will be no excuse for that. That’s why we cannot give tenants more than 40% discount before. But now, the mall is closed. I understand that we must support more for tenants. 

So, Lien, what exactly your mall is doing at this time? 

Lien: 

We are not totally shut down. We still have a supermarket and other tenants who are doing delivery to serve the customers. We still must maintain some technical systems. And we still have security for mall safety. We keep the mall clean by cleaners, we also disinfecting all public area frequently. Tenants who are under construction still continue to do the fit-out to follow the safety rule. We do believe that the day Mall open will come soon and the customer will be back, they will go shopping, they will eat with their families and friends, they will go watching movies… so we must ensure everything always gets ready for those anytime.

So from outside view, people think we just close but inside, a lot of things to work with including thinking for our valued tenants. 

Hoang Anh: 

I think people will change their behavior when this pandemic ends. Even my mum now knows how to shop online without my help. Surprisingly! I believe it creating a new habit for consumers. Online shopping will somehow take place more than before. However, you know that the market will not get back to normal after a few months even if the government declares that we are all safe. Do you have any plans when your mall can reopen? I probably think the customers will still hold a fear in their minds by that time. 

Lien:

We are having some scripts for 2020 and so on. Since we don’t know when and how it goes to an end, we need to prepare plan A, B, C. If luckily Vietnam put the crisis under control, we can reopen the Mall and starting to heal, but what if we need to close longer – as I guess the mall will need to close till the end of this month for better control from Government. And even after, when we reopen, time to recover will take very slow. The consumer behavior may change as you said. Recently, I read a post relating to this matter, it said, when there is something you can live without in 2 months, it means you don’t need it anymore. So, we need the plans for it as well. As a traditional mall, we need traffic; we need people to come for direct experience. So we just hope that shopping online will be just a companion partner to the traditional mall, not a competitor, there are pros and cons of both, but I do believe somehow people still prefer physically to touch than doing everything thru the screen.

To be more detailed, after the crisis ends, we will push more on marketing to support for tenant’s images and try to encourage people to come to the mall. We, for sure, will make the safe experience is the priority. And secondly, we have thought about the tenant mix arrangement because some of the tenants might not come back after this crisis time.  The world has changed so preparation is better than run after. And also, this one is a lesson learned to all, we also need a backup plan and better scripts if a similar situation happens in the future (hopefully not but who knows?).

Hoang Anh:

Yea, safety is the priority. Cannot agree with you more. I hope this one will get over soon. I just read an article on ICSC the other day about “Financial Impact of Covid-19: What retailers and landlords can do?”. Let me make a quote, which is I think it’s a good advice for both landlords and tenants at this time. According to Jami Wadkins, president and CEO of Bayer Properties, she thought “It’s important to listen to tenant concerns and requests, and some will need more help than others. Local tenants typically don’t have the same resources as national credit tenants to weather this, so you may have to strategically respond to those tenants on a case-by-case basis. More broadly, I believe that right now we need a coordinated effort among tenants, vendors, landlords and lenders to strike an appropriate balance of the burden that needs to be carried so that we can all be standing when this crisis ends. “. It presents clearly my thought on this situation. Do you have any words for your tenants that you want to share, Lien?

Lien: 

I am not going to say it on behalf of my landlord. As a department standing between both parties, I understand that all of them have their own difficulties to deal with. But to all tenants, trust your Landlord, please. A true Landlord will not just be standing there and be seeing you die. However, don’t put all the responsibilities to your Landlord, be patient and coordination with each other are the key. I believe the landlord will do the best to support tenant because, at the end, it’s always a win-win relationship goal. 

Hoang Anh: 

Thank you for your thought. I believe this is a battle that no one should leave behind. It’s great to have you as a guest for my first podcast today. I really appreciate it. I think we should say goodbye to the audience now.  

Lien:

Thanks for having me. Bye, everyone! Stay safe and have a good day! 

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