REAL ESTATE SCENARIO IN RETAIL
Written by: Nithin Narayanan
Real estate growth in India can be seen in every nook and corner of the country. Indeed this phenomenon has been affecting the markets for a few years now. One can see apartments, penthouses, bungalows which cater to any and every kind of lifestyle. The SEZs , malls , entertainment complexes are all evidences of the growing economy of the country and also depicts the aspirations of our people. As the economic boom spreads across the country the real estate is attracting foreign investors too.
Coming to retail sector, real estate does play a significant role in achieving the goals of the retailers. One look at any analysis would reveal that there are number of malls constructed and even more are at the planning stages in all the cities across the nation. In one such study that I read, it was mentioned that by the mid of 2008 about 70 million sq.ft of retail space would be added to the retail markets. In spite of the many projects underway , as the demands exceeds the supply currently there is shortage of 500mn sq.ft of shopping space One thing that must be kept in mind is that not all retail spaces are suitable for brands. In other words, each brand or retailer has its own agenda in terms of the position of the brand or the company name and image among its customers. Hence it is quite imperative to be at the right location. On the other hand the challenge for the developers is to find, get and retain the right kind of tenants, so that it is a win-win situation for both the parties concerned.
Increasingly there is a requirement of lobbies in the malls. Also the circulation area where people can move vertically as well as horizontally inside the mall has gained significance. These spaces especially have to be well lit naturally or otherwise and also attractive flooring is the key to wet the appetite of the customer. Until recently in the context of India, general retail spaces had 14' floor to floor height. But now retail spaces have 16' to 20' height which is also the standard worldwide.
Another visible trend is that retail spaces are getting bigger. Malls which are recently opened or are under construction have around 15 lakh sq.ft to 19 lakh sq.ft of space. But how long such a trend would remain is to be seen as costs have also risen considerably in the past few years.