In Hyderabad’s organised retail market, there are many “ghost malls” that account for almost 0.8 million square metres of gross leasable area.
According to the most recent Knight Frank India “Think India, Think Retail 2022” report, as many as 22.2%, or 17 malls, in Hyderabad are currently in various degrees of dilapidation. “Ghost malls” are all mall properties with a vacancy rate of at least 40%.
According to the survey, there have been several ghost malls that have appeared in Hyderabad’s organised retail sector over the past few years. In total, there are 17 of these malls, and their gross leasable space is close to 0.8 million square metres.
All attempts to breathe life into these assets and attract a good retailer mix and footfalls have been unsuccessful, shows the data.
The factors responsible for the sprining up of these ghost malls are believed to be a lack of due diligence, mall shortcomings such as size and ownership patterns, design issues, faulty layout with dark alleys, lack of customer walk flow management, low occupancy and lack of anchor tenants.
“The COVID-19 pandemic, however, disturbed the retail sector’s dream run. With each passing wave of COVID, the retail, travel and hospitality sectors took a severe hit. The accompanying restrictions on mobility made the bounce back that much more difficult,” says Shishir Baijal, chairman and MD, Knight Frank India.
Some of these malls have been issued termination notices to shut down large format stores, which comprised an entire mall, in other cases, discontinuation of operations, demolition of shops inside the mall premises and auctioning of the mall property due to non-payment of dues to the local mall authority, are underway.
The total mall vacancy in India stands at 16.6%, with Hyderabad topping the chart with 22.2% vacancy, followed by Ahmedabad at 21.2% and NCR at 19.5%. The mall vacancy after the exclusion of ghost malls stands at 8.6%, shows the report.
Grade A malls continue to perform well, beating pre-pandemic consumption, footfalls, and occupancy levels. Due to higher vacancy in some Grade B and C malls, developers are re-evaluating leasing options for alternate uses.
Additionally, the ghost malls can be repurposed as huge wealth is trapped in them and they are usually built on coveted land parcels. Some of the solutions are: thrift stores, food and clothing banks, exhibition, presentation and event spaces; daycare, elder care and pet care; elementary and secondary schools; workforce training centres; and human development centres for government services.
India has a total mall stock of 8.6 mn sq m (92.9 mn sq ft) spread across 271 operational malls in the top eight markets – Ahmedabad, Bengaluru, Chennai, Hyderabad, Kolkata, Mumbai, National Capital Region (NCR) and Pune.
As on H1 2022, NCR contributes nearly one-third or 34% of India’s total mall stock, which is the highest across the top 8 markets. The number of malls across the top 8 markets of India has increased from 255 in pre-Covid period to 271 post-Covid. With this, the gross leasable area of malls has also increased from 15.5% to 16.6%.
Apparel constituted the top retailer category to have footprint in shopping malls, during both the pre-Covid and post-Covid periods with a 26% and 29% share in the overall pie, respectively.
At a pan India level, Grade A mall vacancy stands at 4.1% at the end of H1 2022. Grade B and Grade C vacancy stands at 16.1% and 33.5%, respectively. Chennai has the lowest vacancy of 9.9% across the markets under coverage, followed by Kolkata at 11.7% and Mumbai at 14%.
On the other hand in Telangana there are 32 operational malls in different towns. And over 100 in entire Telugu states. The chain-malls associated with big brands like Reliance Bog Bazaar, Croma, Wedding Bazaar, Gold Bazaar, Kids Bazaar etc are fully operational. #KhabarLive #hydnews #hyderabadlive