AKIPRESS.COM - Mongolia Growth Group Ltd. (MGG), a commercial real estate investment and development company participating in the dynamic growth of the Mongolian economy, announced MGG’s core commercial property portfolio experienced a same-store rental decline of 12.3% in September 2015 relative to September 2014 on properties owned 12 months or longer, as measured in Mongolian Togrog (MNT), Stockhouse reports.

Total billed revenue for September 2015 was 248.9 million MNT, as compared to 247.6 million MNT in September of 2014 or a 0.5% increase. The occupancy rate for the core portfolio in August of 2015 was 93.9% including an occupancy rate of 97.1% for core retail properties and an occupancy rate of 89.7% for core office properties.

For much of 2015, MGG has been planning to expand the existing Tuguldur property (TC1) and develop Tuguldur Stage 2 (TC2) as a large retail and entertainment center attached to the existing Tuguldur Center. To date, the company has spent considerably to divert various underground utilities away from the development site along with acquiring the majority of the statutory approvals and permits needed for the TC2 development. However, during the year, it has become clear that the economy of Mongolia is not currently in a condition to absorb a development of the size that was previously contemplated.

Over the past few months, MGG has reviewed their options and chosen to go with a smaller facility of approximately 4,000 square meters of space, producing approximately 3,100 meters of usable space: this project will cost approximately US$3 million and will have a much higher return on capital compared to the previous larger structure.

"Despite the current state of the Mongolian economy, I remain convinced that the economy will ultimately turn around and that investing in Mongolia at this junction is a prudent move," said Harris Kupperman, Chairman & CEO of Mongolia Growth Group Ltd.