At Goregaon’s Oberoi mall, the Forever 21 store has recently been replaced by British brand Marks & Spencer as the retailer was seeking to significantly reduce its floor area in the surburban mall in Mumbai.

Even at Infinity Mall in Malad, international retailers like Gap and Forever 21 have been asking the mall owner to reduce its area by 25 to 30 per cent.

Downsizing in retail spaces usually happens when yields do not match expectations. Mall owners are now on the threshold of re-negotiating their erstwhile deals as ‘right sizing’ becomes the norm with most anchor and mini-anchor tenants at malls.

“It is a dynamic situation since retailers are seeking optimum sizes as the capital investment has to be in sync with their returns. No longer are anchor tenants seeking 30,000 sq ft and above and even at our mall we have had anchor retail stores like Central and Lifestyle scaling down their sq ft area as moderation is the key to sustaining their business models,’’ says T Anupam, Vice President-Mall, Oberoi Mall.

Moderate-sized stores is now the mantra being followed by international retailers like H&M, Zara and Forever 21 as they expand their number of stores in the country.

For instance, H&M which insisted on having 30,000 sq ft stores is now seeking store sizes between 10,000 and 12,000 sq ft.

Zara’s initial stores which measured 50,000 sq ft are now being launched at 20,000-30,000 sq ft, and Forever 21 which began its stores at 15,000 sq ft is now reducing its size to 8,000 sq ft.

Infinity Mall, based in the surburban Malad, has also witnessed retailers rationalising their floor space within its premises.

“Retail brands like Gap and Forever 21 have requested us to reduce their respective areas within our mall by 25 to 30 per cent.

“Retailers usually ask to reduce their floor spaces when business does not happen on expected lines and some of them started expanding in the country. Both Gap and Forever 21, respectively, occupy 10,000 sq ft at our mall and we will have to take a call on what to do with them in future,’’ said Mukesh Kumar, Senior VP, Infinity Mall.

Thane-based Viviana mall, which houses retail brands like Zara and Forever 21, has also seen a similar trend.

“One of our tenants recently has requested us to reduce its area at our mall. There has been a change in strategy for retailers like Forever 21 since the time it exchanged its ownership from DLF to the Aditya Birla Group,’’ said Sunil Shroff, Chief Executive Officer, Malls, Viviana Mall.

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