‘Impression Melaka tourist arrival target achievable’

KUALA LUMPUR (Dec 5): Property developer Yong Tai Bhd is confident of achieving its target of drawing one million tourists annually to its Impression Melaka theatre.

The theatre forms part of the group’s RM5.4 billion flagship mixed development project known as Impression City, which is to be developed over an eight-year period on 117 acres (47.35ha) of reclaimed land in Melaka.

Sitting on a 17-acre site, the 2,000-seater theatre will be facing the Strait of Malacca, featuring nature sceneries as its backdrop, a concept Yong Tai imported from the famous Impression Liu Sanjie night performance in Guilin, China.

Yong Tai chief executive officer Datuk Boo Kuang Loon said Malaysia does not offer sufficient international standard performances that can attract international tourists.

“We have a lot of places for tourists to visit during the daytime, but when it comes to [the] night-time, we lack [night activities] compared to Thailand, Europe, Australia and even China and Singapore. That is why we are bringing in Impression Melaka,” Boo told The Edge Financial Daily in an interview.

Commenting on the commercial viability of the project, Boo said the group is targeting less than 10% of Melaka’s annual tourist arrivals of 15.7 million (as at end-2015) for the new theatre.

“We have our limitations. For every show, we can only cater for about 2,000 people. With two shows in a day, we can get 4,000 people. At 70% occupancy, this translates into about 2,800 people, meaning 1.02 million people in a year assuming we are performing non-stop every day.

“At best, we can receive up to 1.46 million people, and this is less than 10% of the 15.7 million total tourist arrivals in Melaka, not to mention that the total tourist arrivals can continue to grow further,” he said.

Boo said Melaka’s strategic location was a key reason that compelled Yong Tai to build the theatre there, apart from the fact that it is a tourist destination and Unesco World Heritage site.

“From a macro point of view, tourists can easily detour from here to either Kuala Lumpur or Singapore. This is [an advantage] that places like Penang do not have,” he said.

“From a micro point of view, for the one million tourist arrivals we target, we break it into a 4:3:2:1 ratio, with 40% being mainland Chinese tourists numbering about 400,000 people,” he added.

Last year, Chinese tourist arrivals totalled 1.7 million, and Boo said Yong Tai needs to attract about one quarter of that for Impression Melaka.

“It is easily achievable because for Chinese tourists who come here, if there is a show of [a] Melaka story but directed by a famous director that they are familiar with, that would create a desire for them to watch the show,” he said.

Like the other nine Impression series theatres in China, Impression Melaka will be directed by famous film director Zhang Yimou, who also directed the 2008 Beijing Olympics’ opening and closing ceremonies.

Boo said another 30% (300,000 annually) of Yong Tai’s target tourists would comprise Malaysians, whom he feels would be keen to attend an international-standard performance.

A further 20% (200,000 annually) would comprise Asean and other Asia-Pacific tourists.

“I think Singapore itself can cover that easily. The final 10% would comprise Europeans, Australian and Middle Eastern tourists,” he said.

Boo said although the group can stage four performances a day, it had decided to conservatively plan for two shows a day first.

“It is a feasible project. The directors, with this level of reputation, need to ensure their product is able to attract eyeballs.

“This is the first time they are moving out of China and coming to Melaka. Definitely, the directors will need to make sure the show is being done well,” he said.

Since the debut of Impression Liu Sanjie in 2004, the oldest among the nine others, the entire Impression series has been viewed by more than 60 million people to date, according to Boo.

He said Yong Tai expects Impression Melaka to bring in about RM60 million profit a year to the company, after the project is completed and operational by 2018.

Boo’s entrance into Yong Tai as a substantial shareholder can be traced back to June 2015, when he held a 7.16% stake.

Originally a loss-making garment manufacturer, Yong Tai transformed into a property developer in 2015. It has been back in the black since financial year ended June 30, 2015 (FY15), after 10 consecutive loss-making years since FY04.

“For the next two years (FY17 and FY18), we have already told all our investors that we cannot declare dividends because the earnings will only come in after 2018,” Boo said.

Last Friday, Yong Tai’s share price closed one sen or 0.81% down at RM1.23, giving it a market capitalisation of RM197.22 million.

This article first appeared in The Edge Financial Daily, on Dec 5, 2016. Subscribe to The Edge Financial Daily here.