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| Mall vacancy in southern cities drops in July-Sept |
| BS Reporter / Chennai Nov 04, 2009, 00:12 IST |
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The average mall vacancy in the southern cities of Chennai, Hyderabad and Bangalore dropped to 5.7 per cent in the third quarter (July – September) of 2009 from seven per cent in the second quarter.
However, supply in these three cities increased by one million sft, up 33 per cent from the second quarter, according to Cushman & Wakefield, a commercial real estate services and research firm.
Alongside this development, rents stabilised in these markets in the third quarter as against the corrections they had witnessed in the last six to seven months.
Rents in major cities and markets are expected to remain stable in the coming few months. Over 60 per cent of the anticipated supply during the quarter was delivered, a marked improvement from previous few months, it said.
There was no fresh mall space in Bangalore. Though leasing activities remained low, vacancy rates dropped as there was no additional supply in the city. The average rentals stabilised indicating a revival of interest in the city's organised retail space.
However, the Garden City anticipates supply of one million sft in six months, 80 per cent of which is expected to come up by this year end. Bangalore's suburban zone will see more than 60 per cent of the total new supply and the rest will come up in peripheral micro markets.
Hyderabad, till September, witnessed an additional mall supply of 650,000 sft at Madhapur and vacancy dropped to 14 per cent from 17 per cent till June. Rentals are likely to remain stable till March next year.
The mall space in Chennai increased 28 per cent with Ampa Skywalk mall becoming operational.
Food and Beverage outlets continued to be the main driver for retail space and are expected to remain so in the future. Retailers preferred to expand within city limits and refrained from venturing into the peripheries, it said.
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