Phoenix to set up another mall at Pune with 500 Cr Investment

At its newly acquired land mass worth Rs 161 Crore and spread over 1 million sq feet, Phoenix Malls Pvt Ltd is going to set up a new mall. This will be the company’s second mall in Pune. As per reports, the company would be investing Rs 500 Crore (over the land cost) in the project. The mall will be operational in next 4-5 years. In a separate filing with the Bombay Stock Exchange, Pune-based Kolte Patil Developers said that it has divested its land holding at Wakad for the same amount.

“Island Star Mall Developers Pvt. Ltd. (ISMDPL), the strategic investment platform owned by The Phoenix Mills Ltd (PML) and Canada Pension Plan Investment Board (CPPIB), acquired an approximately 13 acres land parcel. This land parcel has a development potential of approximately 1.6 million square feet, of which approximately 1 million square feet is planned as premium retail development,“ the company said. Phoenix plans to develop the balance 6 lakh sq ft as a convention centre, hotel and commercial office space.“We are looking to acquire another 2 acres and the total land cost will rise to Rs 225 crore,“ said Atul Ruia, joint managing director, The Phoenix Malls Limited. The

It is interesting to note that most of the malls in the city are stuggling with a very low number of people actually entering the malls. However, Phoenix Malls and its partner CPPIB reasoned that Pune (like other cities) is underserved in terms of mall capacity measured per person.

“Per capita mall space in Indian metro cities is much lower than some Asian cities. There is no oversupply of grade A malls. On the contrary, there is a dearth of quality retail spaces and large unmet demand which we plan to tap,“ PML said. Ruia said the existing Phoenix mall at Vimannagar had a leased occupancy of 96% as of June 30 this year. “The consumption at Pune mall reported 24% growth and rental income grew by 28% in the quarter ended June 2017 (y-o-y),“ he added. Phoenix's neighbouring mall inOrbit had to shut operations and is now being converted into commercial office space.