With limited malls, city main streets to dominate near-term leasing in retail space
kolkata: Due to limited mall supply, main streets in Kolkata are expected to dominate near-term leasing in retail space while an upcoming greenfield mall in Joka is expected to partially address the gap in demand-supply of quality Grade A mall space in the city, according to a recently published real estate research report.
Compiled by the global real estate services firm Cushman & Wakefield the report shares Q4 2022 statistics of the Kolkata retail space market. It revealed: “Kolkata’s retail leasing momentum remained strong in the final quarter of the year driven by continued bullishness in consumer spending on categories such as fashion, consumer electronics, jewellery and accessories.”
The study observed that “Prominent shopping malls and main streets reported a sharp increase in footfalls in the quarter exceeding pre-covid levels, both on weekdays and weekends, with festive season demand driving retail sales higher. Total retail leasing volumes stood at around 78000 SF in Q4, a 25-30 per cent growth over the previous quarter”.
Although malls accounted for around a quarter of leasing volume in Q4 as compared
to less than 5 per cent in the previous quarters, main streets accounted for 75 per cent of leasing volumes with a national department store chain opening a large store at Rajarhat (Peripheral Business District (PBD) micro market) and another national consumer electronics and durables retailer inaugurating a store at Tollygunge (Suburban Business District (SBD)-South Kolkata micro market).
The fashion and apparel segment accounted for around 60 per cent of retail leasing in Q4, followed by consumer electronics at — 20 per cent, the research revealed.
“QSR segment within the F&B sector is likely to expand not just in Kolkata but also in surrounding markets. However, a major proportion of this expansion is likely to be concentrated around main streets due to space constraints in existing Grade A malls and low visibility of mall supply over next few quarters,” according to the findings of the report.
It noted that there was no new mall completion in Q4, and no new supply is expected in 2023 as well.
“A greenfield mall at Joka (Southwest micro market), which was stalled for the past few quarters, was acquired by a prominent city-based developer and plans are afoot to complete and inaugurate the project by mid-2024. This is expected to partially address the gap in demand-supply of quality Grade A mall space in the city,” it stated.
“City-wide mall rentals remained stable in Q4 although select Grade A malls saw 4-5 per cent QoQ rental growth taking it closer to pre-Covid levels. Landlords/developers are negotiating minimum guaranteed rents with existing tenants and reportedly charging higher rents from new tenants,” it stated.
“Rentals appreciated by around 5-7 per cent QoQ at prominent main streets such as Park Street and Camac Street, thereby maintaining the rental uptrend seen in recent quarters” the report said.
