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Magazine digest -- Chinese business helps Taipei 101 turn profit

2011/01/18 22:27

Thanks to Chinese tourists, Taipei 101 -- the world's secondtallest building -- has turned a profit for the first time in 2010,two years ahead of its operator's forecast.

With a profit of NT$123 million (US$4.1 million) during the firsthalf of 2010, Taipei Financial Center Corp. is expecting itsfull-year net profit to reach NT$300 million.

Taiwan's opening up to China and the building's landmark statushave helped increase the number of visitors to its 91st-floorobservatory and boost sales in its six-story shopping center.

"In the past, 100,000 visitors per month was a big number. Nowthe monthly average is 150,000-160,000, with 180,000 being thecurrent highest record, "said Liu Chia-hao, the company's spokesman.

Half of the visitors to the observatory are from China and it isestimated that Chinese shoppers contributed 13 percent of the NT$4billion in revenue earned by the shopping center in the first half of2010.

However, Harace Lin, chairman and president of the six-year-oldcompany, said the achievement can be attributed in part to the factthat new initiatives have been taken by the management. Lin took upthe chairman post at the end of 2008, when the company was postinglosses of N$900 million a year and had a debt of NT$30 billion.

Since then, the layout of the shopping center has been changed togive prominence to brands and products that Chinese shoppers findappealing.

Another of the company's initiatives is its ongoing effort toform a partnership with China UnionPay in light of the fact that morethan 3,000 UnionPay cardholders spent over NT$1 million each at theshopping center last year.

The company's office management division has also been visitingkey businesses in China for the last 18 months to offer them rentalsof office space at Taipei 101 for their Taiwan operations. Despite an85 percent occupancy rate and the rising cost of rent in the realestate market, the division has not yet made a profit.

Head of the Sinochem Group's Taiwan Office Ke Xiting, said theoil company, the fourth largest in China, was impressed with Taipei101's enthusiasm.

"Chairman Lin personally received us when we were negotiating(for a location in Taipei), which made a good impression on us, " Kesaid.

Even though Taipei 101 now has only seven Chinese tenants,including Levono and Bank of Communications, dozens of Chinesecompanies inquire every month about renting office space there, Liusaid.

On the outlook for the Taipei 101 tower, Lin forecast moreopportunities for growth after Taiwan lifts its restriction on visitsby individual Chinese tourists. The remodeling of the shopping centerin 2012 and opening of a metro line nearby would also contribute togrowth, he said.(Global Views Monthly 295)(translated by Kay Liu)