Knight Frank India, the country’s leading independent global property consultants, has predicted that modern retail will grow from Rs.74 billion in 2009 to Rs.203 billion in 2012, whereas the Real Estate Retail Potential (RERP) will increase from Rs.79 billion to Rs.216 billion. The model also predicts that in 2012, Mumbai will continue to face the situation of oversupply by 1.31 mn sq.ft — six per cent of the total retail stock.
Knight Frank further estimated that by 2012, the higher pace of real estate developments in comparison to the pace of the modern retail market growth will create an oversupply of 21 mn sq.ft in seven cities — Mumbai, Pune, Hyderabad, Delhi, Kolkata, Bengaluru and Chennai.
Its examination of the state of affairs of the retail market implies the frenetic rental hikes witnessed during the boom will not haunt retailers until 2012.
“One of the key findings by our research team with regard to the city of Mumbai is a noticeable undersupply of modern retail in several suburbs across the city. Our research has undertaken an extensive survey of all major operational and upcoming malls and two prominent high streets in each of these seven cities. The report determines the performance of the operational malls in terms of occupancy, rentals; retail formats and also foresees the demand-supply dynamics till 2012,” said Dr Samantak Das, national head – Research, Knight Frank India.
Knight Frank Research Analysis showcases following facts for Mumbai:
Mumbai currently has 8.72 mn sq.ft modern retail stock, which is estimated to reach 20 mn sq.ft by 2012. Besides, the city currently faces a situation of oversupply since there is 20 per cent vacancy of retail space in the market.
|Area||Current Distribution of Retail Stock||Current Mall Vacancy||Upcoming Mall Supply till 2012|