Karnaphuli Garden City shuts as old shopping malls struggle

At least 10 other shopping complexes in Dhaka face possible closure amid falling footfall and sales, insiders say

For many Dhaka residents now in their 30s, Karnaphuli Garden City Shopping Complex in Kakrail evokes memories of a bustling retail hub that drew shoppers from different income groups.

Opened in 1998, the complex shut down on October 1 after years of dwindling business, with only 25 of its 198 shops operational before the closure, according to its owners’ association.

Its closure highlights the challenges facing Dhaka’s older shopping destinations, as changing shopping habits, intensifying competition and falling sales erode their business.

At least 10 other older shopping complexes in the capital are also facing the prospect of closure amid dwindling customer numbers and a prolonged business slump, according to information gathered for this report.

The owners of Karnaphuli Garden City have decided to sell the property, with a hospital, diagnostic centre or office space among the possible future uses.

The development raises questions about whether other established shopping complexes can adapt to changing market conditions and remain viable.

FROM BUSTLING HUB TO CLOSURE

Developed by Karnaphuli Group, the complex occupied the basement and first four floors of a 20-storey building, with residential apartments above. Its shops sold ready-made garments, shoes, cosmetics, jewellery and other goods, alongside a food court.

AKM Iqbal, president of the Karnaphuli Garden City Shop Owners’ Association, told The Daily Star that the owners had unanimously decided to sell the property.

“We are selling it. All the owners are making this decision together. It could become a hospital, a diagnostic centre, a television centre or any other type of office,” he said.

The main complex has shut down, although a handful of shops near the entrance remain open to generate rental income to cover essential expenses, including security guards’ and a manager’s salaries. The owners are even borrowing money to meet these costs, Iqbal said.

The closure does not affect the residential apartments on the upper floors, according to the authorities.

Concord Twin Tower in nearby Shantinagar is also grappling with sluggish business. Although reports suggested the complex might close, its owners later backed away from the decision.

Syed Sharif Uddin, joint secretary of the Concord Twin Tower Owners’ Association, said there were no plans to shut down the complex.

“Our business is not doing well. However, no decision has been taken to close the complex. We are trying to attract customers,” he said.

CHANGING SHOPPING HABITS

Iqbal said Dhaka’s retail market had changed significantly, with new malls, branded outlets and online shopping giving customers more choices.

“Customers can now compare prices and product quality across shops and online platforms. They do not always need to visit traditional shopping complexes,” he said.

Declining footfall has made it harder for shop owners to cover rent, service charges, staff salaries and electricity bills, he added.

Md Helal Uddin, president of the Bangladesh Dokan Malik Samity, said shopping markets had been facing a severe downturn for nearly two to two and a half years. Some shopkeepers go three to five consecutive days without making a sale, he said.

Many businesses can no longer pay staff from their earnings and are dipping into their capital to meet payroll costs. Even those willing to sell goods without making a profit are struggling to stay afloat.

Helal Uddin warned that two or three more markets could close within the next two to three months if the situation did not improve. Representatives of two markets, each with around 300 shops, had recently told him they could no longer sustain their businesses.

He said small and medium-sized businesses had received little government support during the downturn, claiming they had not benefited from taxpayer-funded relief measures since the Covid-19 pandemic.

Closures could wipe out investments worth hundreds of crores of taka and leave thousands of workers unemployed, with few alternative job opportunities, he warned.

Citing Karnaphuli Market, he said the four-floor commercial centre had employed around 3,000 workers and attracted shoppers with its shopping environment and competitive prices.

The association also identified Molla Tower in Rampura, opposite the Television Center, and Bishal Centre in Maghbazar as struggling. 

It estimated that another 10 to 12 shopping centres in Dhaka faced a serious risk of closure but declined to identify them.