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Indian property developer Prestige Group is expanding its portfolio of malls, planning to build 8 new properties across Bengaluru, Kochi and Chennai over the next 4 years. The group sold 4.4 million sq ft of retail space valued at INR 90bn in 2021, with its portfolio currently standing at 2 million sq ft across 4 malls and set to grow to 9 million sq ft across 12 malls.
In an exciting development, Bengaluru-based Prestige Group is set to make a remarkable comeback in the retail industry, with plans to reconstruct its mall portfolio. After selling a significant portion of its retail business to Nexus Malls, backed by Blackstone, two years ago, Prestige Group aims to establish eight new malls within the next four years. With a clear focus on meeting the growing demands of retailers, the company is poised to expand its current retail portfolio from 2 million sq ft across four malls to an impressive 9 million sq ft across 12 malls.
Prestige Group’s CEO of Forum Malls, Muhammad Ali, revealed that construction has already commenced for most of the upcoming malls, strategically located in Bengaluru, Kochi, and Chennai. Furthermore, the company is considering venturing into Mumbai and Goa while exploring potential land for mall development in Delhi-NCR, Hyderabad, and Kolkata. Recognizing the tremendous growth potential of the organized retail sector.
Despite significant progress, organized retail currently represents only about 13% of India’s total retail market. This indicates a vast untapped opportunity for developers to build more malls and cater to the expanding needs of various brands. As retailers experience growth and actively seek additional space, Prestige Group aims to capitalize on this trend and solidify its position as a leader in the mall industry.
Ali expressed Prestige Group’s long-standing interest in establishing a mall in Delhi, acknowledging its high potential. Additionally, Hyderabad, a growing city with a youthful population, remains an attractive destination for mall development. The company also has its sights set on Kolkata, West Bengal, provided a suitable land parcel becomes available. With aspirations to deliver exceptional shopping experiences, Prestige Group aims to meet the evolving expectations of consumers seeking quality lifestyle options.
Driving Retail Growth:
The desire for an enhanced quality of life continues to fuel retail growth across the country. Prestige Group’s CEO highlighted the fundamental shift in people’s aspirations, emphasizing the role it plays in propelling the retail sector forward. While the mall rush in India resulted in mixed success, with nearly 50% of malls failing due to incorrect sales strategies, Prestige Group aims to differentiate itself by focusing on leasing rather than outright sales. This strategic approach ensures long-term success and sustains occupancy rates above 90%.
Despite the challenges posed by the pandemic, mall operators are projected to achieve revenue growth between 7% and 9% in the current fiscal year. This optimistic outlook can be attributed to high occupancy and leasing rates. The year 2023 is expected to witness the addition of approximately 11 million square feet of mall space in the top seven Indian cities, demonstrating the industry’s resilience and the eagerness of developers to cater to the pent-up demand.
Prestige Group’s decision to rebuild its mall business signals a significant development in the retail landscape of India. With ambitious expansion plans, the company aims to capitalize on the burgeoning retail market by providing spacious and vibrant malls that meet the evolving demands of retailers and consumers alike. By adopting a leasing-oriented approach and carefully selecting strategic locations, Prestige Group is well-positioned to join the ranks of successful mall operators. As the organized retail sector continues to grow, this expansion promises to unlock new opportunities for both the company and its stakeholders.
Read the full article here Prestige Group set to rebuild malls business
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