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Over 55 percent of the malls in Delhi-NCR region are vacant partly due
to economic slowdown, poor designing, lack of robust revenue generation
model, and lack of ideal location, a recent survey by the Associated
Chamber of Commerce and Industry of India (ASSOCHAM) has revealed. As
per the study, the vacancy rate in Mumbai malls is 52 percent followed
by Ahmedabad (51 percent), Chennai (50 percent), Hyderabad (48 percent),
and Bangalore (45 percent).
ASSOCHAM conducted a random survey
of all the shopping malls in cities such as Delhi-NCR, Mumbai, Kolkata,
Bangalore, Hyderabad, Ahmedabad, Pune, Dehradun, and Chennai between
October and December 2012. It was found that many upcoming malls have
significantly been delayed and withdrawn due to lukewarm response from
retailers and are likely to face manifold hike in construction cost.Commenting on the scenario, D S Rawat, Secretary General, ASSOCHAM, said that vacancy levels are due to poor location, poor design, and poor parking facilities. Some malls are operating at 60 percent occupancy while others have less than 20 percent occupancy. The retail sector is forecast to grow rapidly, but mall rentals and valuations are not rising in most of the markets, added Rawat.
The survey also highlighted some of the challenges facing the industry including inadequate infrastructure, unavailability of retail space, multiple taxes, lack of clarity in policies, and shortage of experts in areas such as supply chain and store management. Malls are now shifting from lease/rental model to revenue-sharing model encouraging branded showrooms to open in malls.
SOURCE:http://www.indiaretailing.com/news.aspx?topic=1&Id=6799