cbre - india retail market view - 1h, 2011
TRANSCRIPT
-
8/2/2019 Cbre - India Retail Market View - 1h, 2011
1/12
2011, CB Richard Ellis, Inc.
www.cbre.co.in January - June 2011
India Retail
The first half of 2011 witnessed heightened activity in
the Indian retail industry, buoyed by increasing
transaction activity and surging retailer interest. Many
leading brands and retailers had started to renew
expansion plans by the end of 2010, a move
heightened in the first half of 2011. Various established
brands and other national as well as international
retailers continued with their expansion plans across
the country. A positive economic outlook, surging
consumer confidence and spending helped the market
maintain its pace of recovery from the downturn.
Almost 6 million sq ft of organized retail mall space
was added to the country in the first half of 2011. This
was concentrated in the NCR, Mumbai, Bangalore,
Pune and Chennai. Infinity Mall by K Raheja Group in
Mumbai was the largest mall completion in the review
period; spread across 1.25 million sq ft. NCR
witnessed the completion of two eagerly awaited mall
properties Pacific Mall and Moments Mall in West
Delhi, even as a substantial pipeline is also present in
the suburbs of Gurgaon and Noida. Moving ahead, it
is anticipated that retail mall supply in NCR would be
concentrated more towards the Noida region. Inorbit
Mall in Pune and Innovation Mall in Bangalore were
amongst other key project completions. This supply is a
consequence of the positive sentiments amongstretailers on spatial expansion and enhancing their
footprints across the country. Pre-commitments in
under construction assets in prime locations is also an
encouraging sign that rental flexibility, along with the
minimum guarantee coupled with revenue share
model has become more acceptable in the industry.
In all the seven cities presented in this review, the retail
real estate market appears to be promising with anappreciable increase in enquiries being witnessed
from retailers. Retail mall rentals witnessed growth in
prime city micro markets, while witnessing stability in
suburban (supply laden) destinations. Moving ahead,
transaction activity and size are expected to increase
on the back of increase in consumer spending and
expanding mid-income purchasing power. However,
despite this incremental demand, retail mall supply
pipeline is huge, especially in leading cities like NCR,
Mumbai, Bangalore, Pune and Chennai. This would
ensure that pressures remain on developers to offer
rental discounts and transaction flexibility to avoid
higher vacancy levels in the long term.
High street retail has also been on a growth trajectory
for the last few months, with leading brands opening
stores on prime streets like South Extension (Delhi) and
Kemps Corner (Mumbai). Enquiries for prime high
street retail spaces remained high during the review
period and is expected to increase in the coming few
months. The sustained increase in demand led to an
escalation in rental values across most leading high
street destinations.
Hence, while the retail landscape of India appears
dynamic and is continuously evolving, it is imperative
for retailers and developers to increasingly cooperate
and adopt practices aimed at improving footfalls and
conversion ratios in mall properties. It is expected that
the coming few months might witness the relaxation of
restrictions on foreign direct investment in multi brand
retail in India. This is supposed to be a positive move, to
be implemented in a phased manner starting with the
leading metropolitan retail hubs like Delhi and
Mumbai. This provides an immense opportunity to
developers looking at reducing vacancy pressures in
their existing properties, while finalizing large scaletransactions for future commitments.
-
8/2/2019 Cbre - India Retail Market View - 1h, 2011
2/12
Page 2
2011, CB Richard Ellis, Inc.
India
Retail
Ja
nuary
-
June
2011
National Capital Region (NCR)
Market Summary
The year 2010 witnessed a resilient retail market in
NCR, post the recovery from the global recession in
2009. The positive trend continued into the first half of
2011 as well, with market sentiments being optimistic.The first half witnessed three malls commencing
operations namely Pacific Mall (West Delhi), Moments
Mall (West Delhi) and R-Mall (Sohna Road, Gurgaon).
As a result, close to 2 million sq ft of retail supply came
on stream. Transaction activity increased as premium
international brands entered the NCR market, while
existing retailers explored opportunities to execute
expansion plans. Besides international retailers,
domestic brands such as Lifestyle, Woodland, Reliance World and Lilliput amongst others were also in an
expansionary mode.
International brands that launched operations over the
past six months include Vans, Kiehl's at Ambience Mall
(Vasant Kunj), Clark's at DLF Promenade, Diesel, Jack
and Jones, Only, Quicksilver and Roxy at Ambience
Mall (Gurgaon). French high end apparel brand
Lacoste signed for a new store in Select City Walk
(Saket). In luxury retail, the Swiss leather brand Bally
signed for a flagship store at DLF Emporio in Vasant
Kunj.
The newly opened Pacific Mall at Rajouri Garden has
been receiving an overwhelming response, with
increasing number of footfalls. The property has
emerged as the most high-end retail destination in
West Delhi and is being sought after by leading
international retailers. While Canon Image Squareinaugurated its store in the mall in the first half of 2011,
other brands such as Bebe are expected to launch their
flagship stores in the mall in the coming months. West
Delhi also witnessed the commencement of operations
by Moments Mall in Kirti Nagar. The mall has a built up
area of 800,000 sq ft with retailers such as More (the
retailer's largest store; spread over 60,000 sq ft),
Westside and Lilliput. The mall also has a dedicated
area for an indoor amusement park spread over40,000 sq ft.
British shoemaker, Clark's re-entered the Indian
market (after a not so successful tie-up with Lifestyle
previously) with its stores opening at DLF Promenade
(Vasant Kunj) and Connaught Place. Connaught Place
also witnessed the launch of a store by Marks and
Spencer. This was the first store by the retailer located at
a high street destination in Delhi. South Extension also
witnessed store launches by Pantaloons and US Polo.
Overall, rental values in malls have witnessed an
increment across all key micro markets in the region.
Malls in Saket and Vasant Kunj in South Delhi
witnessed a rental increase of around 9-12%
compared to the previous review period. Amongst the
suburban destinations, Gurgaon witnessed
considerable rental appreciation of almost 15-16% as
various brands consolidated outlets to tap the mid and
upper mid-income catchment in the micro-market.
Noida witnessed stability in rental values due to limited
transaction activity. High street rentals also
strengthened across all leading destinations.
Connaught Place and Khan Market witnessed an
approximate4 - 5% increase in rentals, while South
Extension witnessed a steep appreciation of almost 15-
16%. The increment occurred due to revival in footfallsin these traditional shopping destinations.
Rental Trends
Gurgaon Ground Floor, Ambience Mall 10,000 Bestseller Brands
New Delhi Plaza Building, Connaught Place 12,000 Marks and Spencer
New Delhi DLF Place, Saket 15,000 Pure home and Living
New Delhi Second Floor, Pacific Mall 3,000 Mamagoto
Gurgaon Ground Floor, Ambience Mall 2,800 Diesel
New Delhi Inner Circle, Connaught Place 1,900 Clarks
New Delhi First Floor, Select Citywalk 750 Lacoste
District Property Size (Sq ft) Tenant
Major Leasing Transactions
HIGH STREET RENTALS
High Street Average Rental Average Rental
(Jan June 11) (July Dec 10)
INR/sq ft/month INR/sq ft/month
Khan Market 1100-1200 1000 - 1200
South Extension 600-800 550 - 750
Basant Lok 250-350 250 - 350
Connaught Place 550-700 500 - 700
-
8/2/2019 Cbre - India Retail Market View - 1h, 2011
3/12
Page 3
2011, CB Richard Ellis, Inc.
Outlook
Going forward, developers of Grade-A malls are
expected to remain selective about brand mix and
would retain firm control over tenant churn, as new
market entrants continue to express preference for
these properties. As residential areas expand more
towards Noida and Gurgaon, the demand for large
retail formats such as hypermarkets is gaining
momentum. Sensing the retail potential of these
large format projects (which Delhi cannot offer due
to limited space for large formats), rentals are
expected to witness an upward movement in the
micro markets of Gurgaon and Noida in the
coming months. The market is expected to maintain
the optimistic trend over the next few months as
developers have renewed stalled projects and
domestic apparel companies are scouting for
global tie ups aimed at providing the Indian
shopper a truly global shopping experience.
Mumbai
Market Summary
The retail market in Mumbai witnessed an increase in
queries from new as well as existing retailers leading to
an upswing in transactions. While the cautiousapproach (adopted through most of 2009 and 2010)
helped retailers to curtail the losses on account of
reduced footfalls, retail merchants have embarked on
an expansion drive in 2011. This expansion spree is
expected to continue over the next six to twelve months
as retailers look for leasing spaces in high streets as
well as mall properties.
Mumbai witnessed the inauguration of the much
awaited Infinity Mall at Malad (W) with the opening ofstores by brands like Westside, Pantaloons, Reliance
Trends, Aldo and Timberland. Another mall that
commenced operations was the second phase of
Growel's 101, a prominent mall located in the Western
Suburbs with anchor retailers like Pantaloons, Big
Bazaar, Cinemax and E Zone amongst other
international and national retailers. Brands such as
Timberland, Hidesign, Paul and Shark, Chanel
Cosmetics, Aldo and Canon opened their stores in the
High Street Mall during the first half of 2011. Future
Group launched its first gourmet food retail chain -
Food Hall spread over 15,000 sq ft in Palladium Mall.
Other prominent malls such as Oberoi Mall
(Goregaon), Infinity (Andheri West) and Korum Mall
(Thane) also witnessed opening of brands like
Haagen-Dazs, OVS and Celio respectively.
Upcoming Grade A malls like Vivacity (Thane), R-City
Centre (Ghatkoper) and Market City (Kurla) are
witnessing increased traction as these malls are
anticipated to open during the second half of 2011.
Most of these malls would be home to international
brands like Bebe, Chicco, Cinepolis, L'occitane, DKNY
Accessories, Alcott, Boggi, Guess, Next, Nautica,
amongst others, with many of these brands entering
the Western Mumbai Region for the first time.
While malls have witnessed high transaction activity,
high street destinations have also been receivingqueries from numerous brands and retailers. Hermes,
ORGANISED RETAIL RENTALS
Mall Clusters Average rental Average rental
(Jan June 11) (July Dec 10)
INR/sq ft/month INR/sq ft/month
Saket District Centre 275-375 250 - 350
Vasant Kunj 200-250 175 - 225
Noida 150-250 150 - 250
Gurgaon 125-225 100 - 200
Mall Clusters
High Streets
IndiaRetail
Ja
nuary
-
June
2011
-
8/2/2019 Cbre - India Retail Market View - 1h, 2011
4/12
Page 4
2011, CB Richard Ellis, Inc.
the French luxury brand, has opened its first store in
Mumbai spread across two floors and 3,000 sq ft in
one of Fort's iconic Victorian buildings. Kitsch, a luxury
multi brand outlet, opened its first high-street store in
Mumbai spread across an area of 3,000 sq ft at
Kalaghoda. Further, Aston Martin, the British luxury car
manufacturer opened its first showroom in the city at
Kemps Corner, which also happens to be its first store
in the country. Linking Road observed the opening of
stores such as GAS, Accessorize and Tommy Hilfiger
TravelGear along with Indian brands like Catwalk and
Fastrack. Linking Road will also witness the opening of
flagship stores by brands such as Celio, OVS and
Forever New over the next couple of months.
An increase in retailer activity contributed to an
appreciation in rental values in the first half of 2011.
Mall developers continue to work on the Minimum
Guarantee/Revenue Share Model with retailers,
whereas high street landlords have revised the rentals
upwards and are not too keen to follow the Revenue
Sharing Model. Majority of the landlords in prime high
streets are pressing for an upward revision in rentals as
they want to capitalise on the rising demand coupled
with limited quality supply. As a result, most high streets
witnessed an increase in rentals, with the most notable
increase observed on Colaba Causeway, witnessing
an increase of almost 10-11%. While scarcity of mall
supply has led to a marginal increase in rents across
the city, malls in Central Mumbai have observed a
significant rise, with rentals appreciating in the range
of 18-20%, primarily on account of high demand and
low supply of quality space.
Rental Trends
Outlook
An overall positive sentiment in the market with
improved purchasing power and increasing footfallshas led developers to quickly add new retail spaces
to the existing inventory. We foresee this trend to
continue in the near future as well. Retailers will
continue to enquire for space in Grade-A mall
projects and on prime high street locations. Majority
of the malls such as Vivacity (Thane), R-City Centre
(Ghatkoper) and Market City (Kurla) have achieved
significant absorption levels and are slated to open
towards the end of this year bringing in a new mix ofdomestic and international brands.
Major Leasing Transactions
Lower Parel Palladium Mall 15,000 Food Hall
Santacruz, Linking road Amiya Building 5,400 Celio Future Fashion
Kalaghoda Heritage Building 3,000 Kitsch
Santacruz, Linking road Usha Villa 1,600 GAS
Lower Parel High Street Phoenix 900 Canon Image square
District Property Size (Sq ft) Tenant
High Street Average Rental Average Rental
(Jan June 11) (July Dec 10)
INR/sq ft/month INR/sq ft/month
Linking Road 600-900 650 - 800
Colaba Causeway 450-500 400 - 450
Kemps Corner 425-450 400 - 450
HIGH STREET RENTALS
ORGANISED RETAIL RENTALS
Mall Clusters Average rental Average rental
(Jan June 11)I (July Dec 10)
NR/sq ft/month INR/sq ft/month
Central Mumbai 375-500 300 - 425
Western Suburbs 185-275 180 - 250
Eastern Suburbs 160-250 170 - 200
Mall Clusters
High Streets
India
Retail
Ja
nuary
-
June
2011
-
8/2/2019 Cbre - India Retail Market View - 1h, 2011
5/12
Page 5
2011, CB Richard Ellis, Inc.
Bangalore
Market Summary
Rental Trends
The first half of 2011 witnessed an upswing in
transaction activity aided by buoyant economic
conditions and positive market sentiment. A number of
leading national and international brands are makinga beeline for space uptake in upcoming malls as well
as high streets in Bangalore. The city is witnessing a
change in its retail set-up with a number of
hypermarkets getting operational. The city already has
more than 30 hypermarkets operational in leading
malls across the city, while another 30-35 are in the
pipeline over the next three to five years. High streets in
the city have witnessed healthy absorption and rising
enquiries from retailers, which is an encouraging sign
for the retail market in the city. This has encourageddevelopers to tap the growing need of quality space by
initiating new mall projects.
The market observed increased activity as the first half
witnessed the opening of four malls namely Innovation
Mall, Royal Meenakshi Mall, Soul Space Spirit and Soul
Space Arena. The four malls combined together added
supply close to 1.4 million sq ft. Prominent retailers
such as Westside, Pantaloons, Taco Bell (Innovation
Mall), Hypercity, Cinepolis, Max Fashions, TGIF,Reliance Trends, Croma (Royal Meenakshi Mall),
Central, Cinemax (Soul Space Spirit) and Total Hper,
Cinemax (Soul Space Arena) have leased space in
these malls.
Rental values witnessed an increase across prominent
high streets such as Jayanagar, Commercial Street,
Brigade Road, as compared to the second half of
2010. Rental values increased by almost 10-14%
across the high streets of Commercial Street,
Jayanagar and Brigade Road as these markets have
limited supply. The Indiranagar market on the other
hand maintained stability in rental values.
In terms of organised mall retail, the South Bangalore
market witnessed an increment of approximately 22-
25%. This was primarily on account of high demand
for Vega Mall in Jayanagar which is likely to get
operational by 2012. The East Bangalore market
comprising of Whitefield, EPIP Zone and Varthur
witnessed traction with rentals moving upwards by
approximately 10-12%.
Major Leasing Transactions
Outer Ring road Bellandur Soul Space Arena 300,000 Central
Bann erghatta Road Royal Meenakh si Mall 72,000 Hypercity
JP Nagar Vishnu Estates 50,000 MORE Hyper
Bann erghatta Road In novation Mall 25,000 Gopalan Cinemas
Rajajinagar Brigade Orion 20,000 Zara
Bannerghatta Road Innovation Mall 20,000 Pantaloons
Bannerghatta Road Innovation Mall 18,000 Westside
Lavelle Road Stand alone 15,000 Biere Club
Indiranagar 12th Main Stand alone 14,000 Golds Gym
Bannerghatta Road Innovation Mall 6,000 Taco Bell
District Property Size (Sq ft) Tenant
HIGH STREET RENTALS
High Street Average Rental Average Rental
(Jan June 11) (July Dec 10)
INR/sq ft/month INR/sq ft/month
Commercial Street 225-275 200 - 240
Brigade Road 250-300 225 - 275
Jayanagar 11th Main 4th Block 150 - 180 140 - 160
100 Feet Road, Indiranagar 120 - 140 120 - 140
ORGANISED RETAIL RENTALS
Mall Clusters Average rental Average rental
(Jan June 11) (July Dec 10)
INR/sq ft/month INR/sq ft/month
CBD - North Bangalore 120 - 180 130 - 150
South Bangalore -
(Koramangala/Jayanagar) 100-110 70 - 90
East Bangalore -
(Whitefield, Varthur, EPIP Zone) 80-90 70 - 80
Mall Clusters
High Streets
IndiaRetail
Ja
nuary
-
June
2011
-
8/2/2019 Cbre - India Retail Market View - 1h, 2011
6/12
Page 6
2011, CB Richard Ellis, Inc.
Outlook
Retailers are currently in an expansionary mode
and developers are trying to leverage this by
launching projects with quality space. Due to the
lack of quality space in CBD and prominent high
streets, untapped areas with good catchment are
likely to generate interest from retailers. As a result,micro markets which are typically 10 15 km from
the city are high on the radar of developers for
developing various types of retail formats. In terms
of rental values, rents have found support at the
current levels with low possibility of a downward
movement. The revenue sharing model is gaining
popularity with anchor tenants displaying
preference for the model. Large format retailers as
well as departmental stores are positive on the
market and have elaborate plans to make theirpresence felt. With more than 2.7 million sq ft of
organised retail space expected to come on stream
over the next few months (Inorbit Mall, Orion Mall
and Market City Mall), the current landscape is set
to change dramatically.
ChennaiMarket Summary
Retailers as well as landlords have put behind the
negative sentiments of the meltdown and have
aggressively pursued expansion plans. The
construction activity has also picked momentum and is
expected to maintain this trend over the coming six to
twelve months. However this increased supply may not
be sufficient to cater to the increasing retailer demand,especially in the CBD and Off CBD locations.
In terms of organised retail, Chandra Mall spread over
an area of 150,000 sq ft located in Virugambakkam
towards West of Chennai commenced operations in
the first half of 2011. Pantaloon serves as the key
anchor store, with a multiplex, food court and
electronics major Ezone as other leading tenants.
Another mall that is expected to commence operations
during the second half of 2011 is Ramee Mall, aventure of Ramee Hotels having a leasable area of
1,50,000 sq ft. The mall is integrated with a luxury
hotel and Shoppers Stop spread over an area of
45,000 sq ft acts as the key anchor tenant. However the
mall suffers from other limitations like small size and
limited retailer mix.
The Chennai market observed an increase in rental
values during the review period as compared to the
second half of 2010, primarily across high street
destinations. High streets such as Anna Nagar - 2nd
Avenue, Velachery, Adyar and Alwarpet have
witnessed rental appreciation in the range of 10-13%
as compared to the previous review period. Rising
demand level has been a key reason for the upward
revision in rental values. However the closure of
transactions has remained sluggish on account of thegap between the expectations of developers and
retailers. While landlords are quoting higher rentals on
account of enhanced demand, retailers are cautious of
uptake at high rental values. Rental values are
expected to appreciate in the range of 10% -15%
across all the key high streets and occupancy levels are
also likely to improve during the second half of 2011.
Rental Trends
Major Leasing Transactions
Chennai Standalone 40,000 Shoppers Stop
Chennai Standalone 12,000 Ekbote
District Property Size (Sq ft) Tenant
HIGH STREET RENTALS
High Street Average Rental Average Rental
(Jan June 11) (July Dec 10)
INR/sq ft/month INR/sq ft/month
Nungambakkam High Road 140 - 160 130 - 150
T Nagar - Pondy Bazzar 140 - 160 140 - 150
Anna Nagar - 2nd Avenue 90 - 130 90 - 110
Velachery 80 - 100 70 - 90
Adyar 130 - 160 110 - 150
High Streets
India
Retail
Ja
nuary
-
June
2011
-
8/2/2019 Cbre - India Retail Market View - 1h, 2011
7/12
Page 7
2011, CB Richard Ellis, Inc.
Outlook
The retail market in Chennai is expected tomaintain the positive trend over the next six
months. This will be on the back of rising demand
levels coupled with quality supply coming on
stream. Therefore, rentals might witness an
increment in a range of 10 - 15%, primarily in the
CBD and Off CBD locations.
In the organised retail segment, only Ramee Mall is
expected to go operational in the second half of
2011. Other major developments such as Phoenix'sMarket City and Marg's Junction Mall are under
construction and the construction activity is rapidly
picking pace. These malls are expected to become
operational by 2012 or early 2013 and would
contribute in changing the organised retail
landscape in Chennai and may also lead to a
rationalization in rental values.
Hyderabad
Market Summary
The first half of 2011 has not witnessed any significant
development in the retail market as compared to the
second half of 2010. Banjara Hills and Jubilee hills in
the prime city continued to dominate demand from
leading retailers and witness healthy transactions as
compared to other micro-markets in the city (with the
sole exception of Himayat Nagar). Himayat Nagar has
witnessed large number of enquires, especially from
vanilla retailers, however, limited fresh supply has
resulted in slow transaction activity in the micro-
market.
The emerging micro-markets of Habsiguda and A.S.
Rao Nagar have witnessed an increase in queries fromretailers already present in other major parts of the city.
Despite increasing demand, supply remained subdued
in both these micro-markets, with a limited supply
pipeline expected in the second half of 2011. An
emerging micro-market, Banjara Hills Road No. 12
witnessed limited transaction activity, mostly of small
ticket sizes. This micro-market is expected to witness
significant supply by the end of 2011. Some of the
notable transactions on Banjara Hills Road No. 12
were by retailers such as Ratnadeep Super Market, Yes
Bank and Papa John's Pizza.
Jubilee Hills Road No. 36 witnessed increased interest
from new entrants on account of consistent supply of
quality stock and presence of numerous brands in the
micro market. New brands such as Gitanjali Jewellers
(expected to get operational by July), Timberland
(expected to start operations in the second half of
2011), Value Line and EVOK are likely to enhance theattractiveness of this micro-market. Banjara Hills Road
No.2 witnessed the store opening of leading Indian
designer Rocky S, his first in Hyderabad.
While Jubilee Hills is expected to witness fresh supply of
almost 2, 00,000 sq ft in the coming few months, no
fresh supply is expected during the year on Banjara
Hills Road No. 2.
In terms of organised retail clusters, fresh mall supply is
expected to be slow due to sluggish construction
activity. Post the commencement of Inorbit Mall in
2009, there was a slight lull in the retail construction
activity; the next mall likely to get operational is
Manjeera Trinity in the second half of 2012. Besides
this development, The Prestige Forum in Kukatpally is
also expected to get operational in the first half of
2013. Another mall which witnessed considerable pre-
leasing activity during the first half of 2011 is SomaMall on RTC Crossroads. Although the project is still at
ORGANISED RETAIL RENTALS
Mall Clusters Average rental Average rental
(Jan June 11) (July Dec 10)
INR/sq ft/month INR/sq ft/month
Spencer Plaza 120-140 130 - 150
Chennai Citi Center 140 - 180 140 - 200
Ampa Mall 180 - 200 190 - 210
Express Avenue 210 - 230 210 - 230
Mall Clusters
IndiaRetail
Ja
nuary
-
June
2011
-
8/2/2019 Cbre - India Retail Market View - 1h, 2011
8/12
Page 8
2011, CB Richard Ellis, Inc.
a greenfield stage, the developer has managed to pre-
lease substantial space to anchor tenants, including a
twelve screen multiplex. The project is spread over 8,
00,000 sq ft and is expected to become operational by
the year 2015-16.
There has been an increase of almost 3-5% in rental
values across the high-streets of Banjara Hills and
Jubilee Hills as compared to the second half of 2010.
On the other hand, rentals in the micro market of
Himayat Nagar remain stable during the review
period. Rental values across the organized retail
clusters also remained largely stable.
Rental Trends
Outlook
While the Hyderabad market has witnessed an
increase in queries and demand from retailers, this
is yet to translate into actual transactions. The
organised retail segment is likely to gain traction
during the second half as pre-leasing has already
gained momentum for malls that are ready for
completion over the next two- three years. While a
surge is expected in demand from vanilla retailers
for high street spaces, the gap between the format
sizes required by vanilla retailers (1,000-2,000 sq ft)
and the available supply (average floor plate is
4,000-5,000 sq ft) might not lead to the enquiries
converting into transactions.
Pune
Market Summary
Positive economic sentiment coupled with renewed
retailer confidence has resulted in an increase in
queries which in turn has led to significant absorption
of space in high streets as well as pre commitment in
upcoming malls. On the supply front, the city witnessed
fresh supply of close to 500,000 sq ft as Inorbit Mall at Viman Nagar commenced operations. Another
350,000 sq ft of space came on stream with the
inauguration of Pulse Mall on Nagar Road. Inorbit Mall
witnessed uptake by retailers such as Lifestyle,
Shoppers Stop, Spar's, McDonald's, Spencers,
amongst others. Pulse Mall on the other hand observed
the opening of stores by retailers such as Evok, Bata,
Benetton, Big Megamart, Reliance Trends, Reliance
Timeout Corner and Croma. Market City, the 1.4
million square feet mall had its soft launch after days of
extensive publicity. The Mall is bringing to Pune for the
Mall Clusters Average rental Average rental(Jan June 11) (July Dec 10)
INR/sq ft/month INR/sq ft/month
Banjara Hills Road Nos. 1, 2 & 12 60 70 60 70
Western Hyderabad 45-47 40-45
ORGANISED RETAIL RENTALS
Major Leasing Transactions
RTS Cross Roads(CBD) Soma Mall 70,000 Cinepolis
Kukatpally (SBD) NSL Centrum 30,000 Reliance Trends
Chanda Nagar (SBD) Stand Alone 20,000 Reliance
District Property Size (Sq ft) Tenant
HIGH STREET RENTALS
High Street Average Rental Average Rental(Jan June 11) (July Dec 10)
INR/sq ft/month INR/sq ft/month
Himayat Nagar 105-115 105 - 115
Jubilee Hills Road No 36 130-140 120 - 140
Banjara Hills Road No 1 120-130 110 - 130
Mall Clusters
High Streets
India
Retail
Ja
nuary
-
June
2011
-
8/2/2019 Cbre - India Retail Market View - 1h, 2011
9/12
Page 9
2011, CB Richard Ellis, Inc.
first time premium international brands like Zara,
DKNY Accessories, Alcott, Boggi, Diesel, Timberland,
Jack & Jones, Veromoda and Only to name a few.
Bund Garden Road witnessed the opening of the
largest jewellery showroom in Pune by Tanishq, spread
over an area of 12,000 sq ft. The micro market also
observed retailers such as Reliance Digital and Honda
taking up space. The Pinnacle Mall in Koregaon Park
witnessed the opening up of Fiat's showroom. While
most high streets as well as malls across the city were
witnessing space uptake, Ganeshkhind Road has
witnessed reduced demand from tenants with many on
the verge of vacating the Kakade Center Port Mall on
Ganeshkhind Road.
The Eastern Corridor of Pune having seen substantial
supply and absorption of organised retail space, most
of the retailers are now eyeing to set up operations inthe Western Corridor of the city. Amidst the limited
supply expected to hit the Western Corridor, the
exciting and much awaited projects of the ICC Mall
and the Westend Mall have commenced construction.
In terms of high streets, rental stability was witnessed
on MG Road, while renewed interest from retailers
coupled as scarcity of supply led to stimulation in rental
values across JM Road. Rental values at Aundhdeclined marginally as the micro market witnessed
considerable retail churning with retailers such as Dass
Electronics and Koutons shutting down operations.
Rental values in Koregaon also maintained stability
during the review period.
Mall rental values have started witnessing downward
pressure with rentals depreciating in the range on
Ganeshkhind Road and Koregaon Park/Bund Garden
Road in the range of 15-20%. This is primarily onaccount of high vacancy rates coupled with a huge
supply pipeline over the next two years.
Rental Trends
Outlook
Rental values will continue to appreciate in leading
high street destinations as a sustained preference is
being witnessed amongst leading brands for primecity locations. However, significant supply,
specifically along the Eastern Corridor, might result
into downward pressures on rental values. Amongst
the key properties slated to get operational in the
coming few months of 2011 include the Phoenix
Market City Mall on Nagar Road, a mixed use
property with commercial, retail and hospitality
mix; besides the Plaza Center Mall on Kharadi
Road. Both properties are expected to get
operational in the second half of 2011 and add to
the retail mall supply in the market.
Major Leasing Transactions
Viman Nagar Inorbit Mall 40,000 Spar
Nagar Road Pulse Mall 20,000 Spencer
Bund Garden Road Standalone 12,000 Tanishq
Koregaon Park Pinnacle 6,000 Fiat
Viman Nagar Inorbit Mall NA Lifestylez
District Property Size (Sq ft) Tenant
High Street Average rental Average rental(Jan June 11) (July Dec 10)
INR/sq ft/month INR/sq ft/month
MG Road 225-250 225 - 250
JM Road 250-275 225 - 275
Aundh 100-120 100 - 150
Koregaon Park 100-150 100 - 150
HIGH STREET RENTALS
Mall Clusters Average rental Average rental(Jan June 11) (July Dec 10)
INR/sq ft/month INR/sq ft/month
MG Road 200-250 200 - 250
Nagar Road 100- 140 120 - 160
Koregaon Park/Bund Garden Road 100-140 130 - 170
ORGANISED RETAIL RENTALS
Mall Clusters
High Streets
IndiaRetail
Ja
nuary
-
June
2011
-
8/2/2019 Cbre - India Retail Market View - 1h, 2011
10/12
Page 10
2011, CB Richard Ellis, Inc.
Kolkata
Market Summary
Rental Trends
The Kolkata retail market remained steady in the first
half of 2011, benefiting from the global economic
recovery in 2010. There was no substantial fresh
supply in the market and brands that had establishedtheir flagship stores in the city to gain access to the
Eastern region of the country, are still gauging market
response. South City Mall, Forum Mall/Forum
Courtyard and City Centre continued to remain
popular destinations, owing to the existing brand mix
and favourable consumer response.
During the review period, a number of international
brands initiated operations in the city such as
Timberland and FCUK (South City Mall), indicating ashift in consumer preference towards international
brands. Many leading food & beverage outlets also
ventured into the city with brands such as Coffee Bean
& Tea Leaf (CBTL) launching its maiden cafe at Forum
Courtyard and Spaghetti Kitchen launching its flagship
outlet at Forum Mall.
Retailers continued to remain optimistic about the retail
prospects of Kolkata. This translated into growing pre
leasing commitments by major retail anchors such as
Lifestyle that booked space at the upcoming Spencer's
Galleria on Syed Amir Ali Avenue. Hard Rock Cafe also
announced plans of opening a 7,400 sq ft flagship
cafe at The Park Hotel. Domestic retailers such as Cafe
Coffee Day, Fastrack and Asmi continued to expand
their presence through high street stores, while
international brands continued to assess upcoming
developments and supply at existing Grade-A malls.
Vacancy levels across Grade-A malls remained low on
the back of sustained demand and lack of fresh supply.Expected supply that was due to be operational in the
first half of 2011, has been postponed further.
Prominent Grade-A retail developments expected to
make an impact on the retail map of Kolkata are
Spencer's Galleria (Syed Amir Ali Avenue) and Lake
Mall (Salt Lake).
Rental values displayed a marginal increase acrossmicro-markets, led by sustained demand and lack of
fresh supply. High streets witnessed rental appreciation
in the range of 3-6%, with the exception of Camac
Street and Shakespeare Sarani, which witnessed rental
appreciation in the range of 8-9% as they cull favour
with retailers due to high footfalls. In terms of
organised retail, EM Byepass and Salt Lake observed
rental appreciation in the range of 3-4%, while
Jadhavpur witnessed an increase in the range of 11-12% as the micro-market is home to the South City
Mall, which is popular amongst existing as well as new
retail entrants to the city.. The adoption of the revenue
sharing model by developers of existing as well as
competing under construction malls is likely to help in
keeping rental values in Grade-A malls range bound.
Major Leasing Transactions
Elgin Road Forum Mall 3,000 Spaghetti Kitchen
Prince Anwar Shah Road South City Mall 2,500 Calvin Klein
Syed Amir Ali Avenue South City Mall 1,800 Timberland
Prince Anwar Shah Road South City Mall 1,400 FCUK
Elgin Road Forum Courtyard 1,200 Tommy Hilfiger
District Property Size (Sq ft) Tenant
Mall Clusters Average rental Average rental(Jan June 11) (July Dec 10)
INR/sq ft/month INR/sq ft/month
E M Bypass 130-150 125 - 145
Salt Lake 250-260 240 - 250
Jadavpur 225-250 200 - 225
ORGANISED RETAIL RENTALS
HIGH STREET RENTALS
Mall Clusters Average rental Average rental(Jan June 11) (July Dec 10)
INR/sq ft/month INR/sq ft/month
Park Street 280-310 270 - 300
Elgin Road 190-210 175 - 200
Camac Street,Shakespeare Sarani 190-210 175 - 190
High Streets
India
Retail
Ja
nuary
-
June
2011
-
8/2/2019 Cbre - India Retail Market View - 1h, 2011
11/12
Page 11
2011, CB Richard Ellis, Inc.
Outlook
The second half of 2011 is expected to remain
optimistic for the retail market in Kolkata. With close
to 0.8 million sq ft of retail space expected to come
on stream in the near term, Kolkata is likely to
witness a slew of new brands establishing presence
in the city. Rentals are expected to move upwards,albeit at a steady pace. Steady demand will ensure
that vacancy levels remain subdued. Significant
churn is expected in ex ist ing Grade-A
developments, as developers look to accommodate
international brands that are exploring options in
the market to introduce their innovative retail
concepts.
Mall Clusters
IndiaRetail
Ja
nuary
-
June
2011
-
8/2/2019 Cbre - India Retail Market View - 1h, 2011
12/12
Page 12
2011, CB Richard Ellis, Inc.
HyderabadCB Richard Ellis,211, Maximus 2B,Mindspace Cyberabad,Survey No. : 64 (Part),APIIC Software Layout,Madhapur,Hyderabad - 500 081T (91 40) 40335000F (91 40) 40335050
INDIA OFFICES
New DelhiCB Richard Ellis,Ground Floor, PTI Building4, Parliament Street,New Delhi 110 001T (91 11) 4249 0200 / 4239 0200F (91 11) 2331 7670
ChennaiCB Richard Ellis,2C&D, Gee Gee Emerald
151, Village Road,NungambakkamChennai 600 034T (91 44) 2821 4599 / 4571 / 4619F (91 44) 2821 4607
BangaloreCB Richard Ellis,Hulkul Brigade CentreGround Floor, No. 82Lavelle Road,Bangalore 560 001T (91 80) 40740000F (91 80 ) 411 21239
PuneCB Richard Ellis,705/706, 7th Floor
Nucleus Church RoadPune - 411001T (91 120) 26055437/367/397/40190100F (91 120) 26055405
India Retail
About CB Richard Ellis
CB Richard Ellis Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company
headquartered in Los Angeles, is the world's largest commercial real estate
services firm (in terms of 2009 revenue). The Company has more than 31,000
employees (excluding affiliates), and serves real estate owners, investors and
occupiers through more than 300 offices (excluding affiliates) worldwide. CB
Richard Ellis offers strategic advice and execution for property sales and leasing;
corporate services; property, facilities and project management; mortgage
banking; appraisal and valuation; development services; investment management;
and research and consulting. CB Richard Ellis has been named a BusinessWeek
50 best in class company three years in a row. Please visit our Web site atwww.cbre.com.
CB Richard Ellis was the first independent international Real Estate consulting
firm to set up office in the Indian sub continent. Over the last 16 years, the Indian
operations have grown to a network of offices in all the major metropolitan cities.
Today with over 2200 professionals, CB Richard Ellis is one of the leading Real
Estate consultants in the Indian subcontinent. Please visit our website at
www.cbre.co.in
We obtained the information above from sources we believe to be reliable. However, we have not
verified its accuracy and make no guarantee, warranty or representation about it. It is submittedsubject to the possibility of errors, omissions, change of price, rental or other conditions, prior sale,
lease or financing, or withdrawal without notice. We include projections, opinions, assumptions or
estimates for example only, and they may not represent current or future performance of the property.
You and your tax and legal advisors should conduct your own investigation of the property and
transaction.
KolkataCB Richard Ellis, Jindal Towers2nd, Floor, Block B
Kolkata - 700017T (91 33) 40190200F (91 33) 40190230
21/1A/3 Darga Road
MumbaiCB Richard Ellis,#202/203, 2nd Floor,Naman Centre, G-block,Bandra-Kurla Complex,Bandra (E),Mumbai 400 051T (91 22) 40690100F (91 22) 26527655
India
Retail
Ja
nuary
-
June
2011