City malls seeing better occupancy, footfalls

Malls, the mecca of entertainment for Bangalore’s families and their children, have been doing well over the last one year despite talk of recession.

Vacancy in the City’s malls has fallen sharply from around 12 per cent in 2013 to 7 per cent in 2014. This means more shops are coming to malls and the existing space is being well utilised.

And the shops coming in are from the food and beverages, apparel, electronics and jewellery sectors, all of which are the favourite haunts of the City’s upward middle-class.

Compared to Bangalore, Chennai’s mall vacancy has gone up from 6.8 per cent to 6.21 per cent; Mumbai marginally from 15 per cent to 15.2 per cent, and Hyderabad very sharply from 1.4 per cent to 7 per cent.

The vacancy in Bangalore has gone down due to multiple factors. There has been no new mall construction in the last year and approvals haven’t been coming in fast.

Most of them are the ones whose construction had commenced earlier. Mall owners are also keeping rentals low to attract retailers.

This is happening in malls that come under the central business district (CBD) and on high-end roads such as Bannerghatta Road, Indiranagar 100 Feet Road, New BEL Main Road and Koramangala 80 Feet Road. As more footfalls are being registered, rentals are falling even on Brigade Road and Vittal Mallya Road.

People in the business are aware skyhigh rents would deter the trading community, because of which competitive rents are fixed. An advantage with lower rentals is the indirect effect it has concerning consumers – when shops cater to the taste of middle-class consumers, their numbers swell. This results in higher footfalls for the mall as well as the outlet.

Uday Garudachar of Garuda Mall had earlier in an interaction said: “As the man who runs the show, it is important to have more and more people coming in. For instance, if a mall is within the CBD, the expectation would be flow of consumers from catchment areas.

And the very strong catchment areas are Indiranagar, Koramangala and Jayanagar. There are also main streets like Bannerghatta Road and New BEL Road. You would find malls in the vicinity of these areas.”

Mall owners say the outlets that have the best business in malls are food and beverages, then electronics and apparel. Says Garudachar: “Eateries do the best business. If I have to rent out space, I would think of many sectors, but a quick choice would be food outlets.

They make money daily and transactions are quick. Their turnover is fairly high and the number of consumers who come in to the outlets is also very high. Almost all malls have been doing well.”