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Early 2000s was when shopping malls had hit the Indian market and a few years down the line came e-websites, which many believed would be the reason for these malls to disappear from the market. But has that really happened?
According to a recent report by Anarock Property’s Consultant, a real estate firm, in fact, shopping malls are witnessing a visible resurgence in India. A clear measure of increasing focus on the retail sector is that private equity (PE) players invested more than $700 million into Indian retail in first quarter-third quarter 2017 — which is around 90 per cent of the investments that came in during the past two years . Many industry experts believe that entry of e-commerce websites did not have adverse effects on the business of the malls but rather has been useful to the retail segment of the market.
Long-term goals
“Contrary to popular belief, the advent of e-commerce did not impact the brick and mortar retail market significantly. While it did cause some disruption, it was not enough to have a lasting impact on traditional retail formats. Initially stores did register a slight dip in footfalls and sales, primarily due to the heavy discounts offered by e-commerce sites. However consumers returned to the malls seeking a more holistic retail experience”, said Vivek Kaul, Head, Retail Services India, CBRE South Asia Pvt Ltd. Increase in the millennial population can be the other reason for the rise in the retail activity across the country. “The growing demand for the known brands and products leads to a captive demand for retailers planning their entry into a city”, said Kaul.
On how the things are going to unfold for the malls in days to come, Anuj Puri, Chairman, Anarock Property Consultant said, “The changing business environment, favourable policy shifts and the entry of numerous global players indicate that a resurgence of shopping malls in India is definite. The need of the hour is to develop good quality malls that can attract occupiers for the long-term so that the entire value chain of the retail sector benefits”.
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