By Accommodation Times News Services
Bangalore real estate market witnesses a drop in mall space of 7.10 per cent in Q2, 2014 and 7.50 per cent in Q1, reveals latest report by real estate consultant Cushman and Wakefield. The report further mentions mall vacancy in q2 last year stood at 11.95 per cent in Bangalore, also 8 major cities did not see many takers for mall space in the second quarter of 2014 as mall vacancy levels remained at 14.47 per cent.
No new space was added during the quarter in Bangalore and three malls measuring 7,00,000 sq ft in total were delayed in the city due to approval issues, the report says.
Commenting on the uncertainty in the retail real estate market, Sanjay Dutt, Executive Managing Director, C&W South Asia said, “Currently, we are witnessing stagnation in the demand-supply dynamics as mall supply is being deferred and existing vacancies remain more or less stable. Whilst everyone is aware of the huge potential that exists for organised retail in India and domestic and international retailers are keen to expand their presence in the country, they are awaiting the conducive conditions to do so. The real estate sector has been maturing to provide better quality spaces and adopting best practices to cater to retailers’ needs.”
“However, macroeconomic conditions need to improve further to encourage consumer spending and the government needs to address the uncertainty that exists with respect to its policy stand on FDI in retail,” he said.
The report further shows a decline in mall rentals in Bangalore, Chennai, Mumbai and Pune while rentals remained stable across other most other cities. A decline in rental of upto 13 per cent was recorded in Mysore Road and the report attributes this impact on rentals to lower trade densities.
The report predicts a further downward trend for these micro markets and says that other main streets like Indiranagar, New BEL Road, Kamanahalli and Koramangala main roads may see an increase in rentals.