How residential and retail real estate add up in India
SYNC Shopping options must match local purchasing power
Realestateisnotasingleindustry but consists of various categories/asset classes, and each behaves differently at the same time and at different times. Residential, commercial and retail real estate eachserveaveryseparate and distinct purpose, respond to a different type of demand and attract different types of investors.
However, it is equallytruethat all three categories are inter-related because they all depend on eachothertodrivegrowth. What differs in thesethreeassetclasses are the ticket sizes, investment rationale, and investment horizon.To invest in either residential, retail or commercial office real estate calls for different degreesoffinancial capacity, risk appetite, patience and understandingofwhatdrivesgrowthin each of these asset classes.
Therelationshipbetweenresidential and retail is particularly interesting. Inanygivenlocation, acertain type of retail follows (or sometimesevenspawns) acorresponding type of housing. An area which primarily houses middle-class families will attract a lot of unorganized or mom n’ popretail outlets, hypermarkets whichenablevalueshoppingfor dailyneeds, andmallswithalotof mainstream brands. Likewise, luxury housing destinations are most logically juxtaposed with high-endretail. Atthesametime, India’s urban real estate landscape cannot really be clearly defined in terms of mid-income and luxury housing, as a significant numberofresidential areas inourcitiesarehometobothmiddle-class andHNIresidents. This fact hasallowed for averygenerousbandwidthofretailtobecome feasible inandaroundmajorresidential catchments across the country. Let us examinesome of the notable instances:
The high street retail area in this location is located in an upscale residential precinct. The stretch has a good mix of F&B and fashion retail, attracting the affluent population near the market. While the inherent catchment of theprimeresidentialareasinand aroundIndiranagar contributes to the steadily growing footfalls along this stretch, IT parks and offices in the vicinity also act as footfall driversforthishighstreet shopping destination.
Galleria Market, Gurgaon
Thisisanupscaleneighbourhood shopping area juxtaposed with oneofthemostdevelopedareasof Gurgaon where plotted developments, residential colonies and high-rise apartment complexes coexist. Galleria Market has a mix of fashion and mainstream retail stores offering convenience-based categories in addition to F&B. Other categories in theretail tenantmixhereinclude apparel, medical stores, accesso- ries, stationery and gift stores.
Hiranandani Estate, Powai
This is one of the core South Mumbaiareasknownforitselite high-end residential neighbourhood. Mostoftheshoppersonthis high street belong to the immediate or nearby catchment areas. Breach Candy hosts some of the legacyhighstreetbrandsandhas attracted a lot of local high-end fashion designers, as well.
Real estate is not a single industry but consists of various categories and asset classes