Two of the biggest retail leasing deals yet signed in India have been concluded by Pioneer Property Zone, a joint venture between Old Mutual Property Group and ICS Infrastructure, of India.
The leases cover 50,000m² in two developments in Bangalore and Thane, an emerging middle to lower income area of Mumbai, says Ian Watt, director of international operations for Old Mutual Property Group, a subsidiary of Johannesburg and London-listed Old Mutual Group (OML).
He says the Indian retail sector is being reshaped as the country entrenches itself as the world's leading growth economy.
"Traditional markets are making way for new formats such as departmental stores, hypermarkets, supermarkets and specialty stores housed in complexes offering shopping, entertainment and food all under one roof.
"Rapid growth in India's retail market of $200 billion is being matched by a flurry of development plans, "says Watt. "These project 150 new shopping malls by 2008. The expectation is that by 2007, there will be 5 million m² of quality retail space across India and about half of it for fashion lifestyle retailing."
Watt says India, like Saudi Arabia where group advisory services also cover shopping centre developments, has a young consumer base with growing spending potential.
"A high spending community below 45 years comprises 81% of the Indian population, and 65% of people are under 35. The number of people aged 20 to
49 is on course to increase by 30% to 510 million in 2010. This will be the largest number in that age band anywhere in the world."
Yael Shapiro, leasing manager of Old Mutual Property Group, part of a team advising Indian developers, investors and Pioneer Property Zone on concepts, tenant mix and leasing, says a considered approach to retail concepts catering for certain markets is not yet firmly entrenched in Indian retailing.
"Rather the consumer experience has been driven by developers, with little attention to tenant mixes and plenty of replication of brands across centres.
"International brands have had a major impact on the Indian market, from fashion to food and houseware retailing. Their advent has changed behaviour and shopping patterns, and underscored differences between older and younger generations, and their lifestyles and what they wear."
Watt says Pioneer Property Zone has leased the Bangalore project, a luxury destination which is expected to open next year, to one retailer.
The Thane project which is being planned as a town centre development will be anchored by a Shopper Stop departmental store and a hypermarket (Hyper City) and is expected to be ready in 2009.
Watt says a leasing campaign has also been launched by Pioneer Property Zone for a Mumbai lifestyle centre which is to be developed for Indian investors.
"The centre is located in an upmarket area of Mumbai and forms part of a larger mixed use development. It will serve 385,000 households and a population of 2.2 million within a 5 km radius. The centre comprises three floors and will have a five-screen cinema complex, an expansive food court, 85 stores and 570 parking bays.
"In developing the tenant mix for the unique lifestyle centre, the team walked the streets of Mumbai, Delhi and Bangalore for two weeks visiting 1,400 stores, talking to owners, and checking merchandise, price points and product mix. As a result, an optimal combination of tenants has been developed, with anything between six and 20 alternates for each store."
Watt says Property Zone is also advising IVRCL, an infrastructure developer now engaged in an initial public offering in India, on a 125,000m² hotel, office and retail project in Hyderabad, and the Ozone Group of Bangalore, on a 100,000m² retail development in Chennai.
Further afield, it was extending its skills base from Saudi Arabia and development of shopping centres for the Savola Group, to projects in Damascus, Syria, and Bahrain.
I-Net Bridge
Publisher: I-Net Bridge
Source: I-Net Bridge
