With the vacancy levels hitting 28%, it’s unlikely malls in Ahmedabad are going to do well in the next three years. Indeed, it’s not just Ahmedabad,
Diwali this time around has been so dull for malls in other cities as well. If
this trend persists,
kids wholesale clothing malls across the country would be in trouble.
Analysts at Edelweiss, who did some window shopping last week, are wondering whether they were being just old-fashioned and spending time in the wrong
(market) places? They concluded that could be a real possibility because
e-commerce seems to be on a roll — up 64% year-on-year, $2.3 billion sales, high
visibility campaigns and big discounts. Also bigger financing and material.
“We do believe e-commerce is making a difference, but probably more material for phones and consumer durables. (But) we do also see other structural trends—
traditional markets facing more pressure vis-a-vis large format/malls, less
seasonality —more sales through the year —and rising credit card (cash back)
offers,” they wrote.
It’s not that all malls in Ahemdabad or any other city are doing badly. The few well-located ones are drawing in the footfalls. But there’s little supply of
quality malls, said Rajneesh Mahajan, CEO, Inorbit Malls, owned by K Raheja
Corporation. A good mall should be spread over 3.5 lakh sq ft.
Abhishek Sharma of Knight Frank, pointed out Ahmedabad One which opened in 2011, had revived the mall culture in the city. While there was demand for a
good retail property, there is no supply in a suitable location, he explained.
Brands like Zara and H&M are looking to open up stores in the top malls but
the kind of space they are looking for isn’t available, Sharma said.
There are three major malls: Ahmedabad One, Iscon and Gulmohar Park mall, located in and around SG Highway, the city’s retail hub. The Balaji Agora Mall
with an area of 3,00,000 sq ft, located around 15kms away from the highway
opened with a lot of promise but failed miserably because of poor zoning and
leasing of the brands.
Moreover, the absence of a good cinema theatre added to the poor traffic. Some brands have preferred to set up shop on High Streets than to be in an
under-performing mall.
Jayen Naik, senior VP, (operations), Ahmedabad One Mall, observed the retail mix at any mall was very important. Another extremely critical factor which a
mall must deliver to both retailers and patrons is the shopping experience. “If
your stakeholders go back content with their visit, they’re almost certain to
come back,” he explained.
Several elements contribute towards delivering this experience; ease of parking, dining options at the food court, entertainment zones for kids and
similar factors, which are crucial, yet easily overlooked.
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