Main Streets in top 8 cities rule the retail leasing landscape in Q2'18: CUSHMAN & WAKEFIELD
Main Streets in top 8 cities rule the retail leasing landscape in Q2'18: CUSHMAN & WAKEFIELD

 Cushman & Wakefield, leading global real estate consultant’s research findings indicate that the trend of main streets ruling the retail leasing landscape in top 8 Indian cities continued. As compared to Q1’18the retail mall construction trend continues to remain promising in Q2 ’18, with about 1.2 msf of new mall space constructed, and 13.81 msf is currently under construction.

Source: Cushman & Wakefield Research

“2018 has been an illustrious year for the Indian retail landscape so far. Reputed global brands continue to enter and expand in India; a clear sign of the strengthening interest & confidence in this fast-growing market with a burgeoning millennial population. Compared to the last few years, 2018 continues to observe considerable investment activity in retail assets and this upswing is expected to continue”, said Anshul Jain, Country Head & Managing Director India, Cushman & Wakefield 

Cities across India saw noteworthy brands engaging in the retail space, trying to grab their share in this upcoming market. Mumbai’s Lower Parel continued to be the preferred choice for international brands as Moschino, Miniso, Armani Exchange and Typhoon Shelter set up shop during the quarter. In Bengaluru, Asia’s largest 65,000 sf brew-pub - The Big Brewsky, opened in the city at Hennur Road this quarter. Apart from this, Tonique, a premium liquor store, also opened up on a marquee property on Kasturba Road main street in CBD. International furniture brand Ikea is also expected to start operations in their first store in Hyderabad in Q3 2018. Chennai garnered interest of marquee apparel brands such as Lifestyle, H&M, Reliance, and Marks & Spencer.

The mall vacancy figures for Q2 ’18 across cities follows:

City

Mall Vacancy (in percent)

Mumbai

14.5%

Pune

13.3%

Bengaluru

10.0%

Hyderabad

4.5%

Chennai

8.83%

Delhi

22.5%

Kolkata

6.6%

Ahmedabad

27.7%

Source: Cushman & Wakefield

 

Rising demand in the Chennai and Kolkata markets has led to record low levels of vacancy and in turn has driven supply of new malls there. In Suburban west submarket of Chennai, Q2 2018 witnessed the supply of 0.90 msf in VR Mall, which caters to catchments of Annanagar, Koyambedu and Arumbakkam. Increase in mall supply is expected to intensify transaction activity owing to a steady demand from retailers. In the upcoming quarters, Rajiv Gandhi Salai is to witness the supply of 2 malls. Rajarhat in Kolkata observed addition of new supply, with new mall supply of 300,000 sf was added to the city’s retail space after a gap of two years with completion of Downtown Mall in Rajarhat.

Key Private Equity transactions worth Rs 1700 crores were completed in the retail sector in Q2 2018. CPPIB invested INR 938 cr in their platform with Phoenix mills, where they bought land from L&T in North Bengaluru, for development of 1 msf Phoenix market city mall, second in the city. Xander - APG also made a substantial investment of INR 800 cr in North Delhi Metro mall.

In the near future main streets that promise high visibility and footfalls to retail brands are expected to continue to drive majority transactions with key demand coming from apparel retailers. India is a key retail market with a 1.3 billion population, 50% of which is below the age of 25, a growing middle class, high urbanization rate and a fast-growing economy. These features promise a growing retail spend power and hence a shining future for the sector. 

Key highlights: 

  • Current mall inventory across 8 cities is 232 malls, spread across 81.26 msf. There is a 16% increase compared to last 3 years.
  • 32 malls(13.81 MSF) currently under construction in top 8 cities, expected to be operational by 2020. There is a 53% increase compared to last 2 years.
  • New mall supply of 900,000 sf and 300,000 sf observed in Chennai and Kolkata respectively, in Q2 2018.

 

 

 

 
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How The Organic World's Pledge to Reach 100 Stores in 18 Months will Disrupt India’s Retail Landscape
How The Organic World's Pledge to Reach 100 Stores in 18 Months will Disrupt India’s Retail Landscape
 

In 2017, The Organic World (TOW), sprouted as the green heart of Nimida Group in Bengaluru, sowing the seeds of sustainability to cultivate positive change in our way of life. Founded by Gaurav Manchanda, Director, The Organic World, this unique brand strives to offer a holistic range of organic and natural products. From pesticide-free fruits and vegetables to chemical-free homecare products, TOW provides consumers with over 3000 choices to embrace a healthier, cleaner, and more sustainable lifestyle.

The Genesis of TOW

Gaurav, during his return to India from the United States in 2016, identified a gap in the market for healthy and organic food options. Motivated by a personal quest for such products and a desire to offer the same to a wider audience, The Organic World was born in 2017. Starting with the launch of its first store in JP Nagar, Bengaluru, TOW quickly expanded. Today it has 15 stores across Bengaluru, and is exploring the franchise model and the plan is to steadily expand TOW’s footprint across South India.

“Our journey is only getting started. We plan to expand up to 100 stores over the next 18 months, and exploring cities like Chennai, Pune, and more,” he says.

TOW positions itself as a multi-brand retailer, hosting products that are not only organic but also differentiated, providing better value to customers as they journey towards a healthier lifestyle. The stores boasts a comprehensive product range, including fruits, vegetables, dairy, staples, personal care items, and home care products. The presentation of these stores is world-class, ensuring a unique and engaging shopping experience.

Innovative Retailing

Gaurav sheds light on TOW's commitment to responsible retailing, focusing on three core pillars: authenticity, accessibility, and affordability. The company enforces a rigorous vetting process for products, maintaining transparency by publicly listing 25 blacklisted ingredients and chemicals not allowed on their shelves. This disruptive approach challenges the industry to prioritize healthier and sustainable products. TOW has created a strict ‘Not In Our Aisle’ list – a list of chemicals and harmful ingredients that do not find a spot on its store shelves, despite their industry popularity. This includes ingredients like high fructose corn syrup, a sweetener, found in soda, juice, candy, breakfast cereals and packaged snacks; artificial flavorings/colors found in most packaged foods; Tertiary Butylhydroquinine (TBHQ), an antioxidant found in biscuits, microwave popcorn, butter substitutes and chicken nuggets; parabens, sulfates and phthalates found in personal and beauty care products; and a range of acids and toxins found in home cleaning essentials, to name some.

“When you step into our store, it's an interesting and world-class experience. We strive to be a full basket retailer, so you can complete your shopping journey within our stores. Now we have about 3000 SKUs on our shelves, and we continue to introduce interesting categories and products,” explains Gaurav.

Consumer Awareness

The brand’s commitment to sustainability extends beyond its product offerings. It has introduced a zero-waste section in select stores, encouraging customers to bring their own containers for grains and nuts. The company is conscious of consumer preferences, with a dedicated vegan category accounting for a significant portion of sales. TOW's initiatives have not only resonated with environmentally conscious consumers but also positively impacted its revenue.

The Organic World has embraced a tech-driven approach to bridge the online and offline shopping experience seamlessly. Initially partnering with tech enablers, TOW later developed its in-house tech stack, comprising apps, websites, and delivery mechanisms. This move provides the company with more control over data, enabling better insights into consumer behavior.

Acknowledging the challenges in the grocery and organic sector, Gaurav emphasizes the importance of trust in the brand and scale to stay competitive. The company strives to deliver within a two to four-hour time slot, and in a bid to make its last-mile delivery sustainable, TOW is exploring the use of electric vehicles.

Differentiation in a Crowded Market

In a market flooded with products labeled as organic, The Organic World sets itself apart through a combination of the 3As. The brand's strong category play, especially in emerging trends like veganism, further distinguishes it from competitors. The company's commitment to scale, transparent pricing, and a variety of unique products solidifies its position as a leading player in the organic and healthy foods sector.

“We work closely with farmers and a network of farmers under the brand Happy Harvest Farms. They are certified and organic. Additionally, we do our own checks internally, and based on these checks we believe that we are able to provide an authentic experience to the discerning consumer,” Gaurav asserts.

He is optimistic about the future, fueled by the growing awareness of health-conscious consumers. With plans to expand its store network and franchise model, TOW aims to be a dominant player in the Indian organic market. The brand envisions not only leading in the organic sector but also influencing responsible retailing practices across the broader retail industry.

 

 

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