FECs in India have gaps that need to be addressed: Bharti Real Estate CEO

Its MD&CEO says discussions on with many global players for indoor entertainment area

India's family entertainment centres (FECs) or amusement parks space has a major gap that needs to be addressed, and all global players would want to come to the country since it's the only major economy that is seeing sizeable growth, said SK Sayal, managing director and chief executive officer (MD&CEO) of Bharti Real Estate, which is developing India's largest mall with 3 million square feet (msf) in Aerocity, Delhi, having an indoor entertainment space of 300,000 square feet.

 

In an exclusive conversation with Business Standard, the top executive said that while many luxury and high-street food and retail players as well as major retail giants were keen to take up space in the mall, the company was also in discussions with many global players for the indoor entertainment area. However, he noted that the real estate development arm of the Bharti group will not venture into managing the amusement parks or go into joint development.

 

“The big (global) players have started to look at India, but initially some of the local players will have to showcase. We’re looking at players that are operating in markets like Japan, South Korea, Abu Dhabi, Dubai or Finland (Europe), this part of the world. We would like to remain real estate developers, be only facilitators. We may give real estate on rentals, maybe a revenue-share model, to begin with and then move to a regular rental, but we won’t get into operations and ticketing,” Sayal said.

 

Leading global players in the theme park or amusement park space include Magic Kingdom in Florida, Universal Studios in Orlando, Chimelong Ocean Kingdom in China, and Everland in South Korea, while India has its popular parks of Imagicaa, Wonderla, Nicco, and Essel World. Sayal did not specifically comment on reports of Universal Studios coming to India with the largest mall, but underscored the need for large players to come to the country.

 

“There is a gap in the family entertainment sector here and any global player will come here,” he said.

 

Theme parks' turnover in the country is at about ₹5,000 crore currently, which has the capacity to reach ₹25,000 crore by 2030, a CAGR (compound annual growth rate) of 12-15 per cent, according to Anarock Retail’s MD&CEO Anuj Kejriwal. He said that theme-park assets in India were worth ₹46,000-₹51,000 crore, which were set to double to ₹85,000-₹1 trillion by 2030, based on the incoming supply. “This would result in theme parks’ share coming to 1-1.5 per cent of the commercial real estate pie, and about 5 per cent of the retail real estate pie,” he said.

 

As per CBRE, presence of family entertainment centres in malls has expanded from 5-7 per cent of total floor space to 10-12 per cent, with 5-6 msf of retail space set to open in major cities, including Bengaluru, Hyderabad, Delhi-NCR, and Mumbai, in 2025. “This will be further complemented by the aggressive expansion plans of leading FEC operators, thus bringing a diverse range of entertainment options to consumers across the country,” said Anshuman Magazine, chairman and CEO (India, South-East Asia, Middle East & Africa), CBRE.

 

Sayal added that the company will launch Grade-A office spaces in Worldmark 4, 5 and 6, spanning more than 3.5 msf, which are set to be completed by the year-end, and will begin work on Worldmark 3.0 on 3 msf area adjacent to the current development, which will entail investment of upwards of $1 billion towards building of retail as well as office space, in separate phases.

 

“The upcoming phases will see investment of $2 billion, which includes Worldmark 3.0, taking the total development area to 17-20 msf,” he said.

 

Sayal noted that the demand for Grade-A office spaces was set to rise even higher as many global companies were coming to India.