Images Retail - - COVER STORY -

Mar­ket Sum­mary Kolkata con­tin­ued to at­tract in­ter­est from re­tail­ers in the first half of the year. The high street seg­ment led trans­ac­tion ac­tiv­ity in the city, fol­lowed by ac­tiv­ity in or­ga­nized retail. Ap­parel and F&B play­ers dom­i­nated leas­ing ac­tiv­ity.

The re­view pe­riod marked the foray of lead­ing in­ter­na­tional brands in the Kolkata mar­ket - Star­bucks en­tered East In­dia with its first out­let in Kolkata at Park Street, while GAP and Sephora made their mar­ket en­try through South City Mall. However, the city did not wit­ness any new space ad­di­tion dur­ing the re­view pe­riod. Rental Trends Rental val­ues re­mained sta­ble in both or­gan­ised and high street retail seg­ments. Out­look

Qual­ity sup­ply in­fu­sion is ex­pected in the se­cond half of 2018 across most ma­jor cities such as NCR, Mumbai, Ban­ga­lore, Chen­nai and Hy­der­abad. Close to around 4 – 5 mil­lion sq. ft. of new sup­ply is ex­pected to come on­stream in H2 2018. With re­tail­ers ex­pand­ing across Metro and key tier I cities, de­mand is likely to con­tinue to out­strip sup­ply in most ma­jor cities.

In­ter­na­tional fash­ion brands such as H&M, Marks and Spencer are ex­pected to ex­pand across metro cities as well as en­ter new tier I and tier II cities. Prom­i­nent retail devel­oper, Phoenix Mills Ltd re­cently ac­quired un­der­con­struc­tion retail as­sets in In­dore and Luc­know. With REIT’S in the off­ing, the focus on de­vel­op­ing in­vest­ment grade de­vel­op­ments is likely to re­de­fine the retail seg­ment in these tier II cities.

Retail cat­e­gories such as Fash­ion, De­part­men­tal Stores, Sports & Leisure, and Food & Bev­er­ages will con­tinue to dom­i­nate the leas­ing ac­tiv­ity in H2 2018. F&B seg­ment is likely to emerge as a healthy mix of op­er­a­tors. In ad­di­tion, mul­ti­plex op­er­a­tors are an­tic­i­pated to broaden their pres­ence across ma­jor mar­kets in qual­ity de­vel­op­ments across tier I and tier II cities.

Rental val­ues are ex­pected to wit­ness vary­ing trends across high street lo­ca­tions and mall clus­ters through­out In­dia. Although ad­e­quate sup­ply is lined up in all ma­jor cities in H2 2018, the rental tra­jec­tory is de­pen­dent on timely de­liv­ery of these in­vest­ment grade de­vel­op­ments. Rental growth at most high street lo­ca­tions in metro cities is at its peak, so it is ex­pected to re­main sta­ble at these lo­ca­tions.

The retail seg­ment in

In­dia is un­der­go­ing a rapid trans­for­ma­tion and re­tail­ers are in­creas­ingly adapt­ing to a va­ri­ety of store for­mats to ad­dress the needs of dif­fer­ent mar­kets and lo­ca­tions. We an­tic­i­pate that this trend will con­tinue, and re­tail­ers will ex­per­i­ment with more cre­ative for­mats. Dig­i­tal and vir­tual stores are al­ready mak­ing their way in cities such as Ban­ga­lore, with such tech­nolo­gies ex­pected to get even more so­phis­ti­cated in 2018. Although brick-and­mor­tar stores will con­tinue to flour­ish, re­tail­ers who re­align as per cus­tomer ex­pec­ta­tions and ex­plore the most rel­e­vant store for­mats for their brands will sur­vive and thrive.

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