Chennai Is Leading Surprising Comeback Of Mall Era, Says Recent Report

Chennai and Hyderabad are leading the return of the mall era in India. As per a recent report, Chennai alone accounted for more than 49% of mall space absorption in the country in the first half of 2018.

Out of about two million sq.ft. space absorbed in malls in seven major cities, Chennai’s share was 9.57 lakh square feet, as per a report by JLL India. In fact, the city is expected to add another 5.1 lakh of mall space (approx. 4 malls) in the coming six months.

In the first half of 2018, leasing activity, the rate at which mall spaces were taken up by tenants, in the country’s top seven cities rose 75% compared to the same period last year. Surprisingly, the thrust has majorly come from South Indian cities, mainly Chennai and Hyderabad and not from the usual contributors like Delhi-NCR and Mumbai.

The growth in the leasing activity in these cities is attributed to the lack of malls and foreign brands. Most developers so far had focused only on Delhi, Mumbai, and Bengaluru. But now they seem to be also eyeing Indore, Chennai, and Hyderabad because of a growing consumer demand along with investors’ willingness to plow money into these markets.

“There have been no sizeable malls in these markets for almost two years now…there has always been demand in these markets, but serious investors were missing,” Quartz India quoted Ashutosh Limaye, associate director, JLL, as saying. “With good quality malls now coming up, brands have been eyeing expansion here (Chennai, Hyderabad, and other smaller cities).”

It is apparel retailers and food players, that seem to be especially keen to expand in South Indian cities. While Swedish brand H & M reportedly added a second store in Chennai’s Phoenix Market city mall recently, Mumbai based Major Brands is planning to more than double its presence in these cities over next five years.

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