Delays plague supply of mall space
A report by international property consultants Cushman & Wakefield points to a paradoxical situation: . There is demand for retail space in malls across major cities but nearly a fifth of the space lies vacant. The rentals, though, are stable and holding in specific markets. Despite major mall projects, the supply of space is likely to be low over the next two years as projects are being delayed due to various reasons.
The second quarter of 2008 saw the launch of just about a third of the planned launches in major cities. There was a supply of over 2 million sq.ft of mall space in major urban centres against a planned launch of 6 million sq.ft.
Most of the space during the second quarter has been created in the NCR, Mumbai and Kolkata, with nothing happening in Chennai, Hyderabad and Pune. The second and third quarters could see the supply of over 12 million sq.ft, according to a report by Cushman & Wakefield. The report, quoting Mr Rajneesh Mahajan, Director, Retail Services, Cushman & Wakefield, says that despite the low supply, nearly a fifth of the 40 million sq.ft of mall space is vacant. This is primarily because the businesses are targeting the same catchments resulting in oversupply within local markets. The focus is essentially on premium high streets.
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