Developers trim mall size on muted demand
Real Estate

Developers trim mall size on muted demand

On the backdrop of economic slowdown, many retailers are said to have put on hold their expansion plans and this prompted real estate developers to reduce size of their upcoming malls.

Industry players feel that a smaller mall has a higher chance of being leased out completely even as demand declines.

It is learnt that this trend is not restricted to the smaller towns. Even in metros like Delhi, Bangalore and Mumbai, which are getting increasingly saturated in terms of retail space, the mall sizes are shrinking.

Some real estate players are planning to set up smaller malls because of higher construction costs and lower returns. It is learnt that about half a dozen developers are now constructing malls between 2 lakh and 6 lakh square feet each, compared with their earlier plans of over 10 lakh sq ft.

K Raheja Corp's mall Inorbit currently has malls ranging from 4 lakh sq ft to over 8 lakh sq ft. But its latest retail project in Pune will be significantly smaller at 2 lakh sq ft. It will be branded differently too. Business has become very challenging as the cost of setting up big malls has gone up substantially, said Kishore Bhatija, CEO of Inorbit, which is planning to diversify into two new retail formats neighbourhood shopping centres and value format stores to cash in on demand from price-sensitive consumers.

Earlier, credit rating agency Fitch said same-store sales growth of retailers declined across lifestyle and value-based formats in the quarter ended June.

On the backdrop of economic slowdown, many retailers are said to have put on hold their expansion plans and this prompted real estate developers to reduce size of their upcoming malls. Industry players feel that a smaller mall has a higher chance of being leased out completely even as demand declines. It is learnt that this trend is not restricted to the smaller towns. Even in metros like Delhi, Bangalore and Mumbai, which are getting increasingly saturated in terms of retail space, the mall sizes are shrinking. Some real estate players are planning to set up smaller malls because of higher construction costs and lower returns. It is learnt that about half a dozen developers are now constructing malls between 2 lakh and 6 lakh square feet each, compared with their earlier plans of over 10 lakh sq ft. K Raheja Corp's mall Inorbit currently has malls ranging from 4 lakh sq ft to over 8 lakh sq ft. But its latest retail project in Pune will be significantly smaller at 2 lakh sq ft. It will be branded differently too. Business has become very challenging as the cost of setting up big malls has gone up substantially, said Kishore Bhatija, CEO of Inorbit, which is planning to diversify into two new retail formats neighbourhood shopping centres and value format stores to cash in on demand from price-sensitive consumers. Earlier, credit rating agency Fitch said same-store sales growth of retailers declined across lifestyle and value-based formats in the quarter ended June.

Next Story
Real Estate

CRDA Approves Rs 17.32 Bn Tenders for Housing and Infra

The Capital Region Development Authority (CRDA), during its forty-seventh meeting chaired by Chief Minister N. Chandrababu Naidu, approved tenders worth Rs 17.32 billion to develop key infrastructure in Amaravati’s core capital area.Municipal Administration and Urban Development Minister Ponguru Narayana announced that Rs 5.14 billion was sanctioned for completing gazetted officers’ towers initiated between 2014 and 2019. In addition, Rs 1.94 billion was approved for external infrastructure, Rs 5.07 billion for nine towers for non-gazetted employees, and Rs 5.17 billion for twelve new towe..

Next Story
Real Estate

Prestige Estates Nets Rs 30 Bn in NCR Debut Launch

Prestige Estates Projects Limited has recorded sales of over Rs 30 billion within one week of launching its first residential project in the National Capital Region (NCR). The project, The Prestige City, located in Indirapuram Extension on National Highway twenty-four, sold one thousand two hundred units during its initial launch phase.This marks the Bengaluru-based developer’s maiden entry into NCR’s residential real estate market. The company attributes the strong response to brand trust, strategic location, and rising demand for premium, planned communities.The launch covered two reside..

Next Story
Infrastructure Transport

Palakkad Railway Division Upgrades Turnouts for Safety

The Southern Railway’s Palakkad Division has implemented a series of infrastructure upgrades to enhance train safety and operational efficiency. Over the past one year, the division has replaced one hundred thirty-three ageing fifty-two kilogram turnouts with robust sixty kilogram Thick Web Switches, engineered for high-speed durability and increased strength.Seventy-seven track layouts were corrected using advanced computer-based geometry solutions, involving precise longitudinal and lateral alignment with the aid of the T-28 Track Relaying Machine. These corrections improve track stability..

Advertisement

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Talk to us?