Malls are losing their charm as retailers now prefer high street locations
The shift in focus comes even as big players are planning an aggressive expansion.
High street stores are now preferred to malls by retailers as demand is picking up after two waves of the pandemic, according to a Business Standard report which cites a lack of quality malls for this emerging trend.
Retail expansion is skewed towards expanding at high street locations, Shubranshu Pani, managing director, retail services, JLLIndia, is quoted as saying in the report. Malls were among the first centres to close during the first and second wave of Covid-19 and were among the last to reopen, he said.
Manish Kapoor, CEO at Pepe Jeans India, is quoted as saying that the firm will open stores at high street locations if quality malls are not available. As much as 65% of Pepe Jeans stores are in malls currently. According to the report, Pepe Jeans’ expansion plans are back at the pre-pandemic level and are likely to open about 50 stores a year.
Many brands want to be present at the big-ticket malls only, Abhishek Sharma, director at Knight Frank India, is quoted as saying.
Small brands are now following in the footsteps of their bigger counterparts. Small brands now want 50% of new stores at high street locations, much higher than the present share of 10%.
Meanwhile, taking cues of economic recovery, mall developers are increasing rentals.
Pushpa Bector, executive director at DLF Retail, is quoted as saying that rentals have already been hiked by 15% and may rise further by as much as 20-25%.
Mukesh Kumar, CEO, Infiniti Malls, is quoted as saying that the firm is raising rentals in rent agreement renewal cases.
Higher rentals come amid aggressive expansion plans of big retail chains such as Shoppers Stop, Trent and Aditya Birla Fashion and Retail in the wake of recovery in the economy.
Aditya Birla Fashion and Retail had said that it had set an internal record by launching 12 Pantaloons stores in 12 consecutive days of the month of October. It has plans to open about 100 stores every year for the next couple of years.
Another retailer Trent also has big expansion plans and is building a strong supply pipeline.