Targeting middle-end of the market with focus on tier II, tier III cities and metros, a new concept in retailing in India's $300-billion retail segment has emerged—value malls.
Top property developers and local retail chains in regional pockets have evolved the concept of value malls to sell branded apparels, footwear and accessories at prices 25 percent to 30 percent cheaper compared to metros.
Value malls are in a way extension of discount malls and destination malls in the US and within the next two years 45 to 50 such malls are likely to come up selling brands like Peter England, Charley, Excalibur, Kouton and Easies, among others at cheaper rates.
International property consultant, TrammellCrow Megharaj too intends to foray into value malls concept.
Shubhranshu Pani, President - Retail Services, TrammellCrow Megharaj observed that value malls are the answer to scarce space for premium malls on high street and an expected rise of 10-12 percent in metro property prices by end of first quarter of 2007.
Akruti Nirman, with its upcoming malls to be branded as 'CityWorld' too has decided to go for value malls in tier II and tier III cities after six months.
Hemant Shah, Chaiman Akruti Nirman, contemplates developing value malls of 1 to 3 lakh sq ft area which will give same or even more returns on investment compared to malls in metros depending on positioning of the malls and cost of land.
About 8 value malls on fixed rental income basis are planned in Vapi, Silvassa, Amritsar and Wardha in coming two years, informs Saurabh Tayal, Chairman KSL Realty and Infrastructure Ltd.
As cost of land in Tier II and Tier III cities is 40 percent cheaper than metros, realty majors are scouting for opportunities to develop 3 to 5 lakh sq ft of malls in Tier II and Tier III cities in 2007.
For this purpose Pune, Ludhiana, Jalandhar, Nasik, Nagpur and Coimbatore are being considered by mall developers like Pantaloon Retail, Hiranandani's, Rahejas, Akruti Nirman, Prestige Group, and DLF.
marketing@alchempro.com
