Sluggish demand from the Apparels and FB retailers keep the mall vacancy rates stagnant
There is a positive activity in the commercial real estate and plush office spaces are selling like hot cakes among the corporates who are planning expansion in their workforce and businesses in India. However the story in the retail and consumer durables sector does not seem to be the same.
Overall mall vacancy levels across the top eight Indian cities remained stagnant at 14.47 % in the second quarter of 2014. It was recorded around 0.4 percentage points lower compared to the first quarter. The global property consultant Cushman & Wakefield’s latest retail report released on Tuesday came up with this data.
Amongst the top eight cities, Pune witnessed the sharpest decline of 2.5 percentage points. It is speculated that the decline is a result of the “healthy” leasing activity and no new mall supply. Apparels and food and beverages (F&B) retailers are not placing new requests for mall spaces and hence the demand is sluggish.
Ahmedabad, Chennai and Bengaluru also recorded drops of 0.4 percentage point each due to a moderate demand for quality mall spaces. It looks like the bifurcation of the state of Andhra Pradesh has resulted in some activities in the erstwhile state capital Hyderabad. Hyderabad witnessed a rise of 1.1 %, in mall vacancy in the same period.
The report also talked about three malls measuring seven-lakh square feet in total were delayed in Bengaluru due to approval delays. On the other hand, slower construction pace in tandem with low leasing led to deferment of one mall each in NCR, Pune and Hyderabad. The areas of these malls are seven lakh square feet, 4.30 lakh square feet and five lakh square feet respectively. The first half of 2014 did not witness the opening of any new malls in the financial capital of India, Mumbai.
Source- The Times of India
