Nirmal Lifestyle, a large shopping mall at Mulund (a Mumbai suburb); Inorbit, a shopping mall which caters to the suburban consumers of Mumbai & Navi Mumbai (Malad and Vashi) and Star Shopping Centres Pvt Ltd (who promote the StarCentres chain of malls) are in the process of building new malls by next year. Nirmal Lifestyle is in the process of launching Phase 2 of its mall in Mulund, says a top company official. The mall will be operational by December next year.
“We have invested Rs400 crore in Phase 2 of Nirmal Lifestyle and we are looking at independent projects in the next financial year in different places,” says Dharmesh Jain, chairman and managing director, Nirmal Lifestyle.
The global downturn has not stopped retailers from expanding, but the number of malls supposed to come up by 2010–2012 has come down drastically, said an industry expert. “In 2007 there were 400 malls which were coming up across the country till 2010-2012 but now we have only 100 malls coming up by 2012, out of which I think 15-20 malls only will be operationally successful malls,” says Anuj Puri, chairman and county head, Jones Lang Lasalle Meghraj, a global real estate services firm specialising in commercial property management, leasing, and investment management.
The retail industry in India is worth $410 billion currently out of which about $20 billion is modern retail, which includes malls and chain stores, says Puri.
Inorbit is coming up with three more malls within next year (at Hyderabad, Pune & Bengaluru) with an investment of over Rs1,000 crore in these new projects.
Inorbit is inaugurating a new mall at Hyderabad, which is one of the largest malls with 800,000 sqft of retail built-up area which will be operational by next month. Hypercity in Hyderabad—which occupies 100,000 sqft, has already been in operation since July 2009. “We are looking at a soft launch by early next month with two of our anchor stores—Shoppers Stop and Lifestyle and a few others,” says Kishore Bhatija, director, Inorbit.
The Hyderabad mall will have 150 stores and the second will come up in Pune at Nagar Road which will occupy around 500,000 sqft. The Pune mall will be operational by August next year. The third project in the pipeline is an Inorbit mall in Whitefield, Bengaluru (capacity of 400,000 sq ft) which will be operational by December next year.
“I feel the retail business has a lot of potential if you apply the right kind of strategy. We have seen a healthy growth in our business as we expanded from Malad to Navi Mumbai, Vashi,” says Mr Bhatija.
Star Shopping Centres Pvt Ltd, another mall owner, is planning new chains. The company is promoted by Shilpa Malik, president and chief executive officer and Pranay Sinha, managing director. Both were the brains behind the famous Select Citywalk in South Delhi, and formed their own company in 2008 after the success of this mall.
The company is coming up with its first project in Bengaluru by the end of the first quarter of the next fiscal and is planning to build 10-12 new mall chains across the country. “Our first shopping centre is modelled on the designs of High Street (the mall chain in Portadown, UK) which offers the benefits of an organised shopping mall and also the benefit of visibility that High Street gets,” says Ms Malik. Mumbai’s Phoenix Mills, which was converted into a mall, is built on the High Street model.
“We are trying to come up with different formats of malls like lifestyle centres, destination centres, etc. All our shopping centres will be (based on) a revenue plus rent-share platform,” says Ms Malik. For example, an apparel store will shell out 12% -18% of its revenue, while food outlets may have to part with 20% of their revenues.
Kishore Biyani’s VC firm, Future Venture, has a stake (the VC is not ready to reveal the percentage) in Star Shopping Centres. Future Venture is planning an IPO to raise funds for Star Shopping Centres.
Star Shopping Centres has also tied up with Deepak Fertilisers and Petrochemicals Corp Ltd who own the Ishaniya mall in Pune. They have also inked a deal with Bhasin Infotech & Infrastructure Pvt Ltd, a Delhi-based developer, which owns the Grand Venezia in Greater Noida. Star Shopping Centres will be delivering their expertise in conceptualisation, planning, strategising and marketing for the two malls. The Grand Venezia will mainly cater to tourists from across the globe.