There is a three-storey H&M in Bangkok’s Icon Siam – the first in the world to feature a 360-degree opening on all sides – and Sanveer Gill built it while losing money for four consecutive years. He knew it was the right call. His father told him not to worry. They waited.

Gill is the director of Gill Capital Group, which holds the regional franchise and operating rights for H&M across Southeast Asia. At last week’s NRF Asia Pacific conference, he offered a granular account of how the company thinks about brand selection, market entry, landlord relationships and the commercial discipline required to remain standing in a region undergoing one of its most disruptive retail periods in decades.

A business built on a $500 bet 

The backstory to Gill Capital is inseparable from the career of its founder, Jagdev Singh Gill, who arrived in Singapore with $500 and built one of the most significant multi-brand retail empires in Southeast Asia. 

His first company, Royal Sporting House, was listed on the Singapore Exchange in 2000 under the name Royal Clicks before being renamed RSH in 2003, according to records held by the National Library Board of Singapore. At its peak, Royal Sporting House spanned 520 free-standing stores, 570 shop-in-shops and 28 retail concepts, carrying brands including Zara, Reebok, Nike, Adidas, Ted Baker, Lacoste and Callaway, with annual sales exceeding US$1 billion. He sold his majority stake in 2007 to Golden Ace in 2008. 

Gill Capital was established in the same year as the RSH sale. It now operates approximately 125 stores across five Southeast Asian markets and employs more than 4000 people. Its brand portfolio today includes H&M, COS, Brunello Cucinelli, Giorgio Armani, Orlebar Brown, Alo Yoga, On Running, Golden Goose, and Läderach, alongside proprietary concepts such as Candylicious, D’ark and Scoop Whole Foods.

Sanveer Gill joined the business in 2007, the same year it was formed. 

“I came back into the business very cocky, very arrogant, and there were 10 years of no progress,” he said. “Things were really stalling for me, and it was very, very frustrating.” The succession to CEO was announced before Covid-19 arrived, what he called a ‘really challenging time’ to manage a generational transition, but by then, he had been in the business long enough to have developed the commercial clarity the earlier years had denied him.

The case for contraction

One of the defining decisions of Gill’s tenure has been consolidating Gill Capital’s operating footprint from 16 markets to four. 

When he examined the profit structure of the family’s first business at the age of 22, he found that roughly 90 per cent of the earnings came from just 10 per cent of the portfolio. The rest was headcount, lease obligations, logistics complexity and operational drag.

“I realised that whilst I was coming into a family business and coming into retail, fundamentally at the end of the day you need profit to sustain yourself, to sustain your company, and also to give back to society,” Gill said. “Without it, you can’t really do much.”

“For me, it was always about overestimating risk, underestimating opportunity and maximising return. That was the formula in terms of how I would look at things whenever we were considering opportunities.”

The contraction carried a cost in internal politics, with “a few bruised egos and some heated conversations,” but it also clarified the business’s identity and concentrated capital on markets and relationships where returns were credible. 

Gill Capital today operates in Singapore, Malaysia, Thailand and Indonesia, with retail as its sole business vertical. There is no real estate portfolio, no family office, no hedge against a bad retail year in an adjacent asset class. The company’s exposure to the sector is total. That concentration, Gill argues, is not a risk but a commitment that keeps decision-making honest.

“I think retail is all about longevity, and if you really want to stay in the game, staying focused is very important. I also realised that as a family, we only do retail. There’s no real estate portfolio, there’s no family office for us. Retail is our livelihood, and I think that size and scale without focus would have taken us away from being able to sustain our lives and the lives of our team,” he said. 

Icon Siam and the arithmetic of patience

For a case study on how Gill Capital’s long-horizon approach translates into financial returns, the Icon Siam story is the clearest. The mall, which opened in November 2018 on the west bank of Bangkok’s Chao Phraya River, was a US$1.5 billion project by Siam Piwat. It was also, at opening, far removed from Bangkok’s central commercial district and its BTS Skytrain network, making it a commercially uncertain proposition for early tenants.

Jagdev Singh Gill was consulted by the mall’s ownership a few years before the opening, and responded by securing three large, strategically positioned spaces at the heart of the complex: a restaurant facing the river, a duplex retail unit across the ground and first floors and a substantial triplex for H&M. 

“We suffered losses for four years, but my chairman always said to me, ‘Don’t worry! They will come, they will come.’ “Gill said at the event. 

Covid-19 extended the pain. When a major luxury group subsequently approached Gill Capital about acquiring the lease, Gill made what he describes as an impulsive offer that offended both the brand and the landlord, not because the price was unreasonable, but because it violated the protocol by which such groups expect to control their own expansion. The approach did not go further.

Twelve months later, those spaces became the first Jo Malone store in Thailand on the ground floor, and an Alo flagship on the first floor. The outcome, by Gill’s account, was a near tripling of the top-line revenue from that location and a five-times improvement in the bottom line.

The landlord problem 

Gill’s most pointed observations concern the dysfunction in the landlord-tenant relationship across Southeast Asian malls. The entry strategy for many retail groups, Gill noted, involves paying whatever the landlord asks, which raises the floor on retail rents across premium malls.

“I think this is causing a lot of disruption, because it’s squeezing out a lot of the smaller brands and smaller retail players. And forget profitability. Now survival is of the essence,” Gill said. The issue, in his framing, is not the identity of the new entrants but the concentration risk they create. “In a shopping centre, you have to have a retail ecosystem that ranges from a money changer all the way up to a Brunello Cucinelli. Everything plays its part in the overall ecosystem,” Gill said.  “Landlords need to look at the portfolio holistically and consider what they charge for the different components to make the whole thing financially feasible for all the different varieties of brands.” 

He stressed the importance of tenancy mixes formally reviewed every few years, rather than held in place by landlord inertia.  “Certain shopping centres are kind of stuck with their tenancy mix. They’re stuck in their reluctance to change. But I think there needs to be a refresh in shopping centres every three to five years to curate what the customer demands and what the market demands in terms of the assortment of brands,” he said. 

His evidence for the urgency of that point is personal: securing Alo’s entry into Marina Bay Sands took, in his own telling, “seven years, five months, and three days’ of knocking on the door”.

“That space should have happened a lot sooner,” Gill said. 

Further reading: CAA’s Adrian Staiti: What the world’s top talent agency wants retailers to know.