Committed to their theme of ‘After Here Nowhere’, mall developer Bhumika Enterprises is approaching new projects with unique designs, a fresh perspective and an open mind. In an exclusive chat with Shopping Centre News, Uddhav Poddar, Managing Director, Bhumika Realty talks about the impact of the COVID-19 lockdown on the real estate industry.
He also analyses the changes and learnings, consumer behaviour, SOPs and norms that the industry must live with in COVID times. Aside from this he elaborates on the progress of his upcoming shopping centre while revealing his expansion plans in 2021.
EXCERPTS FROM THE INTERVIEW…
Tell us about the current situation of the real estate industry in India, focusing on the lockdown and unlock phase?
When the lockdown happened, the situation was quite grim and worrying for the real estate industry. All construction activity was stopped and there was a lot of ambiguity as no one knew what was going to happen in the future. No one was even allowed to visit construction sites. People were scared and were worried about their lives, so thoughts of property and construction sites became non-essential in any case. But as things began to improve slowly, people have realised that they must live alongside the situation and have started moving forward accordingly.
In the last two months, we have seen enquiries coming for leasing the space in malls. Although there were enquiries in the earlier phase as well, but the conversion rate was very low. August 2020 onwards, sales have picked up substantially and I would say September has been very, very good for the industry. A lot of developers including us are doing business equal to pre-COVID levels. We have high hopes from October and November, due to the festivals.
The reason for such a quick development, I think, is a logical one. A lot of people who did not believe in property, especially the younger generation, which is more prone to renting than owning a house, car etc., realised in this stress period that owning property has so much more value. This generation is now beginning to invest in and buy more property.
What impact did the crisis have on shopping centres? Tell us your brand’s perspective.
Since both our malls are under construction, we didn’t feel too much of an impact. The brands which have signed up with us are still there and none of them have backed out. In fact, none of them have even renegotiated the rentals with us. We were actually lucky that our malls will be operational by next year and we expect the current crisis will have eased by then.
Unfortunately, for malls which are running currently, this situation has been very tough. The brands and the developers had to eventually sit together and work out a mechanism formulae which included everything from rentals to revenue sharing, CAM, brand and mall reputation etc. It was a difficult time for both mall developers and brands, but things are improving rapidly now.
What changes/ learnings do you take from the pandemic and crisis from an upcoming mall’s perspective?
We are making technological changes in our development. We are trying to go as contactless and touch-free as possible. Be it the elevators, entry and exits points, common area, lavatories, we are trying to make everything touch-free in all possible ways. We will also be engaging in a lot of virtual engagement with the customer. One change that this pandemic has brought in the consumer behaviour is that people now are keener in using the digital version and technology.
People who used to do shopping manually are also using mobile phones to shop now on a regular basis. They are looking forward to the digital version of shopping, payment, delivery etc. The conversion rate has gone up by huge numbers. Today everyone can be reached virtually which was not possible six month months back. Even in real estate, we have reduced our spending on the outdoor media and other manual advertising activity and are doing the virtual campaigns in large numbers as it is reachable to a larger part of the community.
Is your mall, Urban Square, in the final phase of completion now?
The civil construction part of Urban Square is over but there is other work going on. The exterior work, interior work, painting, wiring and plumbing are the few key things in progress right now. Urban Square possession date for the retailers was in January 2021 and we have extended this to April 2021, based on the request of the retailers. Our project is on completion stage and the handover process will be on time and we will launch the mall by Diwali next year.
Has work started in full progress or are there still many challenges? Have the workers returned to the construction site in full numbers?
There were challenges with the workers’ situation, but this is a process which is quite organised. A manufacturer is successful only if he has a backup ready for every possible situation. We had to find a quick solution and we decided to engage with multiple contractors to speed up the work. As a result, we didn’t lose any time in the process. We are currently ahead of time.
What SOPs are you following as far as mall construction and maintenance is concerned?
There are many things happening at the site right now. Every vehicle entering the site is sanitized by a machine, be it personal one or carrying the construction material. Every person entering the site is checked thoroughly and basic requirements such as wearing of masks and hand sanitisation is taken care of. We have a doctor coming to the site every day since the day we began working post lockdown. Every staff member, including the 500-odd workers, is checked by the doctor on a daily basis. We utilise an hour daily conducting this process and can’t compromise on it.
When a few staff members tested COVID positive, we got everyone on the site tested for the virus and then quarantined the staff for a two week period. We took steps which were required and didn’t risk anybody’s health in the process.
What are the brands that have confirmed their availability
so far in your malls? How many have been added post lockdown?
We added quite a few brands post lockdown for both the malls. INOX, Shoppers Stop, Marks and Spencer, Reliance Trent, TATA Westside, Skechers, Himalaya Optical, Kazo were with us before the lockdown. We added adidas and are in touch with another brand as an anchor store. Apart from this, there are
brands lined up for the vanilla space as well which we will reveal later.
Any new innovations related to technology and consumer
convenience that you have decided to include in your malls after the COVID situation?
We are working on integrating technology in both our malls. To be contactless and touch-free is one of the key aspects. For the
air-conditioning we have made the major changes. The amount of fresh air intake has substantially been increased as per ISHRAE guidelines. This is one major investment done which is elated to the technological aspect as well. We have been in the process of implementing motion sensor equipment in the areas such as elevators, lavatories etc.
We are also studying and in discussion in making the mall Omnichannel. There are steps which we are following initially but as we have one year in hand, we will be implementing them slowly and more precisely.
Tell us about your expansion plans.
Urban Square is in its final stage of completion and we are very excited about the project. Alwar Mall is also gearing up for its final phase as well. We are looking at launching something in Jaipur very soon. We are also looking for some retail projects in Bikaner as well.
Aside from this, we will be going for the construction of Urban Square, Udaipur Phase 2 soon. There is a strong demand for this, and we cannot overlook it. In real estate, we are looking to get into the affordable housing segment in the NCR market.
In how much time do you think real estate will bounce back in Tier II & III cities post COVID-19?
If you ask me, real estate was actually not on track before COVID and is now coming back to normalcy. It is going to be healthier in the coming months. The lockdown period has left a huge impact on the lives and thought process of the people and they have realised their priorities. The investors also have realised that real estate is a tangible asset to invest in. In the last two three years, a new set of challenges in form of policy reforms, GST, NBFT and banking crisis created doubts over the real estate industry. Now with so much time has passed and emergence of new players, these challenges are not problems anymore. The developers are used to it now. Even the banking sector is again back on the lending process. The flow of the capital which was stopped in the lockdown period is now not a problem. The banks are ready to lend and the interest rates have gone down.