Retail, a major driver of economy growth

Mr Amit Khaneja, vice-chairman, Collage Group talks about the group and its various projects, Collage mall in particular, in an interview with Retailer

 

Retailer: What is the origin and success of Collage Group and Collage Estates Private Ltd?

Amit Khaneja: The Collage Group was founded in 1990 and over the years, the Group has grown across verticals with diversified business interests. The Group companies include Collage Estates Private Limited, Collage International Trading Services and Collage Sports Management. Mr Sumet M Khaneja, former CEO, Som Datt Builders (International and India) is the present chairman of Collage Group. The Collage Group is a research and knowledge-based real estate player and believes that it is, rather than concrete structures, the volume and the velocity of the flow of people, merchandise, energy and money that will be the driving force behind building successful retail and real estate concepts.

That is why we believe that ‘People make spaces’ and understanding their consumption patterns and shopping behaviour can help us create retail landscapes and choreograph shopping experiences that people love to come back to. Our goal is to work towards the success of our tenants (the retailer brands) and investors by developing real estate concepts in which the organized retail has access to the right environment to display merchandise, build brands and maximize ROI. Further, we incorporate the latest architectural and design capabilities, technology formats and local supply chain efficiencies to build world-class projects in India.

Retailer: Which projects is the company working on currently?

Amit Khaneja: Collage Estates Pvt. Ltd is developing retail and housing projects in various parts of India including Amritsar, Dehradun and Bhopal. In Punjab alone, the Group has investments worth Rs 2,000 crore. The ongoing project, Collage mall in Jalndhur is spread over 5 lakh sq.ft, and integrates shopping, entertainment and leisure experiences. Approved under the Punjab Governments Mega Investment Scheme, the project is planned to be completed by December 2008.

Retailer: The group is investing Rs 2,000 crore in Punjab alone. What made you choose Punjab as your retail project destination?

Amit Khaneja: Our research tells us that Punjab has tremendous potential for retail. A massive NRI base, rich agriculturists, increasing per capital income, rising consumer aspirations and a retail market growing at 12 per cent are factors, which translate a huge business opportunity.

Retailer: How is Viva Collage mall in Jalandhar placed? What is the location and catchment area of the mall?

Amit Khaneja: Viva Collage mall is an ongoing project, which is worth a total investment of approximately Rs 250 crore. It is located on the Delhi-Amritsar highway (NH-1) at a distance of nine km from Jalandhar City Centre, and therefore very much accessible to posh areas of its neghbourhood. The site is emerging as a new retail destination. The mall has a vast catchment area, which comprises of primary and secondary trade segments. Within the primary trade area comes three zones, which comprises of many places like Model Town, New Javahar Nagar, Arya Nagar, Preet Nagar and Sundar Nagar. Secondary Trade Area includes travel zone having around 8,000 vehicles daily, NRI villages and key towns like Chareru, Dhilwan Morh, Moga, Phagwara and Nakodar.

Seventy per cent of leasing is done already. Anchor tenants like Aditya Birla Retail, Limited Dubai based Landmark Group’s Lifestyle & Maxfashion and Cinemax, a 5-screen, 1500-seater multiplex will be main pullers of visitors..

Retailer: What is the USP of the mall and how is it different from existing malls in India?

Amit Khaneja: Our value proposition to our consumer is based on key findings of consumer research and takes into account factors like consumer aspirations and enhancement of their lifestyle, family appeal and middle class. Our understanding of the catchment area helped us in developing a differentiated value proposition that gives us an edge over other retail or mall developments in the catchment area. Our value proposition to the shoppers is ‘All Under One Roof (AUR)’. Viva Collage will be a destination that drives people out of the city for the widest offering, wherein the consumer can spend his meet and meet all his needs also.

Services shall be one of the key differentiators and help in building a strong association and an emotional attachment between the shopper and the mall. The other key differentiator will be a strong sense of community displayed by the mall management and the forging of strong linkages between the tenants, the society and the shoppers.

Retailer: Which are the anchor tenants in the mall? What prominent brands will their stores have?

Amit Khaneja: Aditya Birla Retail Ltd, Lifestyle & Maxfashion of Dubai- based Landmark Group, Ezone of Future Group and Cinemax will be the anchor tenants. The mall will also be a home to a variety of retail brands like Lifestyle (Departmental Store), Diwan Sahib, Blackberrys, Benetton, Timex Watches, Adidas, Provogue, Indigo nation, Scullers, Nike, Adidas, Maxfashion, (Departmental Store), Koutons, Biba and Jealous.

Retailer: How has the shopping behaviour of Indians changed?

Amit Khaneja: During the past few years, Indian consumer personality has experienced a paradigm shift. India is growing younger, richer and more global. Buying branded products, vacationing abroad, owning multiple cars and TV’s, and generally behaving like counterparts in developed world indicated in the consumer research proved that the consumer is, besides regular shopping, indulging in categories. Youth is aspirational and highly fashion conscious family is the hub of the wheel around which most of the activities happen. Consumers opt for upgrading to better options and spending more money per category. The target customer segment (upper middle, high class) has high propensity to spend and is highly aspirational. In other words, consumers are eager to upgrade and try out new products, entertainment and eating options.

Retailer: What future do you predict for the mall in India?

The current scenario looks promising. GDP has been growing at nine per cent and organized retail constitutes 36 per cent of the total GDP and is growing at 10 per cent. The share of retail can only be expected to increase. Today, retail is one of the major drivers of growth in the Indian economy. The Retail sector now has tremendous opportunities. It is estimated to be worth approximately Rs 13, 200 billion and expected to grow at 35 per cent to Rs 264 billion by year 2015.The share of organized retail, which is at present only three per cent, is expected to touch a high of 9 to 10 per cent. If we read the changing mindset and consumption behaviour of Indians, mall culture in India is here to stay and flourish.

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