Montblanc tables highest bid in Changi luxury tender

The Singapore Changi airport terminal three luxury goods tender has attracted 10 bidders for six outlets totalling 683sq m (7,350sq ft) of space in the south departure/transit lounge. The Civil Aviation Authority of Singapore has stipulated that the stores must sell single brands from product categories other than liquor, wine or confectionery.

Just one retailer, Osim International, bid for all six units, while the remainder tabled bids for the biggest 135sq m (1,453sq ft) outlet only. Osim offered to pay the airport 15% of monthly sales for all six outlets, or S$60,000 ($39,215) for all but the biggest shop, for which it proposed to pay rent of S$70,000 ($45,750) a month.

Osim faces competition for the biggest unit from Club 21, which proposed a Mulberry store, for which it has offered to pay 25% of monthly sales or a monthly rent of S$110,000 ($71,895).

Other bids included those from jewellery retailer Da Vinci, which submitted a bid of 30% of monthly sales or a minimum monthly rent of S$30,000 ($19,607). MB Melwani Private proposed an Aigner shop and offered 20% of monthly sales or rent of S$50,000 ($32,680) a month. Kwang Sia bid for a Hugo Boss outlet for the location, offering 25% of monthly sales or S$51,000 ($33,333) in rent.

Richemont put forward plans for an Alfred Dunhill store for the site, for which it offered 22% of monthly sales, rising to 24% if annual turnover exceeds S$3m ($1.96m), or a minimum monthly guaranteed payment of S$45,000 ($29,410). Fashion label Ermenegildo Zegna bid 22% of monthly sales or S$55,665 ($36,382) a month in rent.

Montblanc offered the highest bid for the location, promising to pay 24% of total sales up to S$500,000 ($326,797), plus 27% of monthly sales greater than that amount up to S$667,000 ($453,947). Beyond that figure it promised to pay 30% of sales or a monthly rent of S$139,889 ($91,430), whichever is higher.

DFS Venture Singapore and Luxury Ventures both offered multiple options for the biggest outlet. Luxury Ventures pledged to pay a minimum of 22% of monthly sales for all of its propositions for the location. These included a Shanghai Tang store, for which it offered S$52,000 ($33,986) in rent for the first year, S$56,000 ($36,600) for the second year and S$60,000 for the third year if sales were below S$325,000 ($212,418) a month. If sales exceed this figure, the retailer promised to pay S$92,000 ($60,130) in monthly rent for year one, rising to S$96,000 ($62,745) in year two and S$100,000 ($65,359) in the third year.

Like Kwang Sia, Luxury Ventures also submitted plans for a Hugo Boss store, but it did not match Kwang Sia’s offer. Luxury Ventures promised to pay a minimum monthly rent of S$34,000 ($22,222) in the first year, S$37,000 ($24,185) in the second year and S$40,000 ($26,143) in the third year if monthly gross sales fall below S$300,000 ($196,078).

The retailer also proposed a Fendi store, promising a monthly rent of S$33,000 ($21,568) for the first year, S$36,000 ($23,530) for the second year and S$39,000 (25,490) for the third year if sales are below S$300,000 a month. Above that figure the retailer said it would pay S$73,000 ($47,712) in the first year, S$76,000 ($49,673) in the second year and S$79,000 ($51,634) in the third year.

Alternatively, the retailer suggested a Bvlgari boutique for the location, for which it would pay the airport S$53,000 ($34,640) for the first year, S$57,000 ($37,254) for the second year and S$61,000 ($39,869) for the third year. If monthly sales exceed S$325,000 ($212,418) the rent would rise to S$93,000 ($60,784) for the first year, S$97,000 ($63,398) for the second year and S$101,000 ($66,013) for the third year.

The retailer submitted a further two options, namely a Coach outlet, for which it is prepared to pay S$54,000 ($35,294) for the first year, S$58,000 ($37,908) for the second year and S$62,000 ($40,522) for the third year. If sales exceed S$325,000 a month, the rent would rise to S$94,000 ($61,437) in the first year, S$98,000 (£64,052) for the second year and S$102,000 ($66,666) for the third year.

The final proposition was for a Tod’s leathergoods boutique. The retailer offered to pay S$33,000 ($21,568) for the first year, S$36,000 ($23,529) for the second year and S$39,000 ($25,490) for the third year, with rent rising to S$73,000 ($47,712) in the first year, S$76,000 ($49,673) in the second year and S$79,000 ($51,633) in the third year if monthly sales rise above S$300,000 a month.

DFS Venture Singapore offered four options for the retail space, proposing either a Burberry, Emporio Armani, Gucci or Polo Ralph Lauren outlet. For the Burberry store the retailer said it is prepared to pay 31% of monthly sales or a monthly rent of S$85,000 ($55,555). For Armani it offered 22% of monthly sales or S$34,000 in monthly rent. For Gucci it proposed to pay 30% of monthly sales or a monthly rent of S$132,088 ($86,332) and for the Ralph Lauren option it said it would pay 25% of monthly sales or S$40,800 ($26,666) in rent.

The winning bidder or bidders will sign a three-year contract with no option for renewal, beginning in January or February 2008.