As Gurgaon was gradually developing into a Millennium City over the past decade and struggling to make the most of its empty spaces, it gave rise to a different kind of struggle: the one among its numerous swanky malls.
“Earlier, there was a great demand for malls in all tier-one cities but the biggest challenge was the shortage of real estate. Gurgaon then came to their rescue with not only availability of land, but also an appreciating value. Hence, we saw this sudden entry of malls in Gurgaon,” said Anshuman Magazine, chairman and managing director of international real estate consultant CB Richard Ellis, South Asia.
As many as 24 malls set up shop in the city, giving it a lustrous look and a new moniker — City of Malls. Some worked; some didn’t, while a countable few made it to the top.
Over the years, there has been a slow but steady change in customer preferences and market saturation in Gurgaon. Result: a gradual reduction in footfall leading to many stores downing their shutters. Experts attribute this unforeseen trend to a host of factors.
Consumer is God
Experts have observed that there has been a shift in consumers’ mentality from looking at malls as a mere shopping hub to an amusement hub. “There has been a change in trend as people no more come to malls only for shopping. When the women are shopping, the children could play in a kids’ zone and the men could hangout at a sports store or a beer bar,” said AK Gupta, head of Sahara Mall on MG Road.
The present demand is that a mall should be a mixed bag of entertainment, lavish cuisines, regional and international brands, says Manish Bhatia, head of mall operations, DLF.
Personnel from several mall managements have attributed the likely bubble burst to the lack of quality infrastructure around these malls. For instance, with one rainshower, MG Road — the Mall Mile housing 11 malls — gets flooded, thereby disrupting traffic flow.
Another issue is that of parking, for which, consultants and experts suggest that the malls expand their parking lots.
‘Pubs ruin mall culture’
This factor can be best explained by citing a recent case, wherein a group of 101 school students were caught drinking at DT Mega Mall on MG Road. Even if this is considered a one-off incident, many malls have suffered a drop in footfall due to drunken brawls, prostitution, etc. “The pubs in these malls have ruined the culture. There are more than 20 pubs on MG Road that attracts anti-social activities,” said Gupta.
Anchor Store for a success
It is a basic fact that for a mall to be successful, an anchor store is a must. MGF Metropolis, the mall on MG Road, has an occupancy that is as low as 40-50%. Yet it has been a success, thanks to its anchor stores — Home Centre, Woodland, Bata and Lifestyle.
Sold mall model a dampner
Most malls in Gurgaon had adopted the ‘sold-mall model,’ wherein owners sold shops to investors who did not set up a shop. Many of them saw this as an investment and have been waiting to sell it at a premium ever since.
Bubble waiting to burst?
“Euphoria over malls is over. Developers do not want to risk their investment by constructing malls as the lease model is taking over and they don’t get quick returns on investment,” Raj Singh Gehlot, managing director, Ambience Group, said.