Realty major DLF will invest around ₹2,000 crore to construct two new shopping malls in Gurugram and Goa, as it sees huge growth potential in organised retail with opening up of the economy after significant reduction in COVID-19 cases.
Sriram Khattar, Managing Director, DLF Rental Business, sounded bullish on India's organised retail sector which was affected very badly in the last two years due to the pandemic.
Khattar said the DLF is expanding its retail real estate portfolio and will develop two new shopping malls, including 'Mall of India' Gurgaon and four neighbourhood shopping centres.
At present, DLF has a retail footprint of 42 lakh square feet comprising eight properties, including malls and shopping centres, mainly across Delhi-NCR.
"We have started the construction of a premium mall in Goa of about 5.75 lakh square feet. It will be the best mall of Goa to the standards which our malls are," Khattar said.
Asked about investment, he said it would be around ₹300-350 crore over the next two years. "We are also in the advance stage of planning for our 'Mall of India' Gurgaon comprising 2.5 million (25 lakh) square feet area," he said.
The construction is expected to start by the end of this year.
"So the architects have started doing the designing. We hope to complete it over the next six months or so. Since it's a very large mall, the planning takes more time," Khattar said.
He said the 'Mall of India' Gurgaon project cost would be around ₹1,500-1,600 crore, excluding land cost. Asked how different this project would be from the two million square feet Mall of India-Noida, he said: "With each experience, we have tried to improve upon ourselves. Therefore, from our learning from Noida mall, this will be that much better."
That apart, Khattar said the company has started a concept of high-street shopping centres to cater to the requirements of people living around.
"We have started construction of one in DLF-phase 5, Gurgaon, which we are calling Summit Plaza. We are likely to start one in Moti Nagar, Delhi near our DLF-Midtown project. We are also planning one or two more of these," he said.
The high-street shopping centre in DLF phase-5, Gurugram will be of around 3.8 lakh square feet, while the one in Delhi of 2.2 lakh square feet.
On plans to enter new cities for development of malls, Khattar said the company would explore such possibilities. The company is developing some value added retail component in its upcoming IT park DLF Downtown, Chennai.
Khattar informed that the retail portfolio contributes around 18 per cent to its total rental income and 12-13 per cent to its total annuity portfolio.
DLF has developed around 153 real estate projects and an area of approximately 331 million square feet. The group has 215 million square feet of development potential across the residential and commercial segment.