The retail industry slump appears to be exercising a negative effect on development of new malls. Pride Mall Ltd, the commercial construction arm of the Estate Pride Group, is understood to be looking for a buyer for Northbloc Mall, its upcoming project in Bangalore, according to industry veterans tracking the real estate scene.
NorthBloc Mall, which is presently under construction, has been planned to come up on 120,000 sq ft (11,000 sq metres) of land. Estate Pride Group has been planning a total of 400,000 sq ft of developed space with three levels of retail and six levels of office spaces, with underground parking offering over 700 parking spaces.
An Estate Pride official confirmed the news that the group is scouting for a buyer for the property, but declined to offer further comments.
Pride Malls Pvt Ltd is the commercial construction arm of Estate Pride. Over 300,000 sq ft of retail space on the Northbloc project is understood to have been completed so far, toward which the developer has entered into pre-lease agreements with key retailers.
The Estate Pride group’s tenants in the office realty segment include Deutsche Software, American Express, Matrix Telecom, Wipro, Nirvana, Satyam and Sasken.
The group has had a presence in the Bangalore real estate market since 1995, investing across asset classes in the residential, commercial, IT and retail spaces. In the process, it has entered into pre-project investments on greenfield projects with groups like the Rahejas, Brigade and UKN. Its office projects include Pride Pinnacle and Eastland Citadel.
While the market for shopping malls is considered to be in its nascence in India, new projects have regularly been announced. However, many shopping mall projects in West and South India have also been put on the backburner in anticipation of poor retail demand.
According to a survey conducted under the aegis of the Assocham Social Development Foundation earlier this year, kirana stores and local retailers remain the most preferred destinations for a majority of shoppers across the country as compared to malls, as they provide for cheaper purchases to the extent of 25 per cent and offer options for avoidance of payment of duties such as VAT and other local levies on the articles sold by them.
Asipac, a Bangalore-based real estate development consultancy, notes, India still does not have a super mall, which is at least 1.12 million square feet in size, while the US had 50 of them and even South Africa 21 way back in 2005. India’s largest 12 malls qualify as regional malls (5-1.12 million sq ft) while Australia has 75 regional malls besides 15 super malls, according to Asipac.
Mantri Square in Bangalore, India’s largest operational mall, is less than a fourth of the world’s largest mall — the 3.77 million sq ft Dubai Mall.
