KLIA retail discussions to be completed by April

Gavin Lipsith

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Tenants in negotiations with Malaysia Airports anticipate that new contracts will be finalised by April

Retail concessionaires in negotiations with Malaysia Airports over renewing contracts at Kuala Lumpur International airport (KLIA) expect discussions on new space to be completed by April 2006, RavenFox.com can reveal. The talks are the first steps toward Malaysia Airport's new retail line-up, which will be completed once renovations to the international terminal and satellite building are completed, by 2008.

Dimensi Eksklusif, Valiram Group, DR Group and Sriwani are all in discussions over extending their contracts and gaining new space, as is Malaysia Airports retail subsidiary Eraman. The next part of the process will begin once those discussions have been completed, with the airport authority assessing potential gaps in its offer before considering other retailers, possibly from outside Malaysia.

The retail revamp at KLIA is part of the authority's strategy of decreasing its dependence on aeronautical revenues. It is aiming to grow non-aeronautical revenues from 35% to 50% over the next few years, after which it would be able to reduce airline fees in order to attract more carriers to the airport.

Retailers at KLIA have been operating contracts on a monthly rolling basis since their original concession agreements expired in June.