Are Malls Finally Losing Sheen?
July 1, 2008
Big brands who were anxious to pick up prime mall space till last year now have aggressive expansion plans, but in high street locations.
Big retail brands are deserting malls for the high street. Retailers say most mall projects get delayed and with the cash crunch faced by mall developers, they are looking for other options to avoid expansion delays of their own.
Subranshu Pani, Director – Retail, Jones Lang LaSalle Meghraj, said, “Developments take 24-36 months to happen. Three years is a long time for a brand. Some of them get access to high streets where they can move in and begin operations in three months. “
Levis Strauss is one such brand. Last year, the company leased a 14,000 square feet property in Mumbai’s high street, Linking Road.
Currently, in tier 1 cities, 60% of its stores are in high streets. And in tier II cities, 90% of its stores are located on main streets.
Shyam Sukhramani, Director-Marketing, Levi’s India, said, “We continuously need to look at the high street locations and be present in those high street locations, irrespective of the fact of whether malls come up or not.”
Most retailers are willing to pay rentals of Rs 600-800 per square feet for high street stores in Mumbai and Delhi, twice as much when compared to mall rentals.
Even though the gap between mall rentals and leases for stores on highstreets in tier II cities is much lower, big brands still prefer the visibility that these streets have to offer.
So, from textile brands like Reid and Taylor, sports goods major Adidas and Aditya Birla-owned More stores are all looking for a 90-95% store presence on high streets.
It is not just about delayed projects. Retailers have now realized that a dual presence in malls and high streets will be vital for continued success. In fact, experts believe that high streets of tier II cities will be the new nerve centers of India’s unfolding retail boom.
Source: http://www.moneycontrol.com/india/news/business/are-malls-finally-losing-sheen/17/30/344988
DLF to Develop Eight Malls this Fiscal
July 1, 2008
“We are thinking of launching seven-eight new shopping w malls in the metros in this financial year,” DLF Retail ing w Developers Sr General Manager (Marketing) Manish Sawhney told w reporters on the sidelines of Pure and Play Retail Summit.
DLF Retail only leases out space in its properties.t.old w The company would also open four shopping malls in the d w current year, of which three would be in Delhi NCR and one in w Chandigarh, he added.
“Chandigarh mall will be smaller one while the three in w malls in the Capital will have three-to-four lakh sq ft of in w leasable area per mall,” he said.
On investment front, without divulging details, he said, w “Leaving the price of the land, the construction cost is id, w around Rs 3,000-4,000 per sq ft.
When asked if the company would also concentrate on id, w smaller cities, he said, “Our primary focus is on the metro w cities like Bangalore, Chennai, Hyderabad and Delhi. As we w grow, we will also look at smaller cities in future… We are w right now exploring all opportunities,” he said.
Also, when asked if the company has signed any big are w retailers, Sawhney said, “Rigth now we are in discussion with w many big retailers, but nothing has been finalised yet,”.
DLF Retail currently has five operational malls. DLF Retail currently has five operational malls.
