news

Exclusive Brand Outlets’ share in organised retail space contracts in India’s NCR

KUALA LUMPUR: Across the National Capital Region (NCR) in Delhi and Bengaluru, the share of Exclusive Brand Outlets (EBOs) in organised retail space has shrunk, according to DTZ Research’s October 2009 report on emerging retail trends in India.

During the global economic slowdown, malls in the NCR, which contribute nearly 50% of organised retail stock in seven major cities, saw a high churn rate of tenants and deeper correction in rentals of 50% compared with the 27% correction seen for high-street rentals.

“Most of the high-street retail space in India is owned by occupier/investor at historically low prices, making this market more accommodative to rental pressures,” it said.

It added that retail space on high streets is low compared with malls, which have accounted for almost all new supply additions over the last few years.

However, the real estate advisers noted that EBOs in Mumbai showed a much healthier take-up rate, almost equal to 2008 levels.

“Most large retailers have put their expansion plans on hold while some have consolidated their exposure by closing down loss-making outlets,” DTZ Research said in its report.

“With the economy and disposable income stabilising, we do not expect this trend to accelerate in future.”

The real estate advisers also said that it believes the retail sector would soon see a more sustainable uptrend with positive changes in the shift in retail space-occupation trends and its consolidation and the softening of leasing terms in favour of the occupier.

“These, together with effective mall management are expected to bring more sophistication to the sector,” it said.

“The trend of revenue sharing gained wider acceptance across cities, both amongst developers as well as retailers,” it added.

DTZ Research also noted that among individual segments, value retailing had faired better than lifestyle and luxury retailing, which had seen the most number of exits.

However, it noted that exceptions were seen in Delhi NCR’s Square One Mall and DLF Emporio.

Looking for properties to buy or rent? With >150,000 exclusive listings, including undervalued properties, from vetted Pro Agents, you can now easily find the right property on Malaysia's leading property portal EdgeProp! You can also get free past transacted data and use our proprietary Edge Reference Price tool, to make an informed purchase.
SHARE