With new mall supply reducing to a trickle in the first half of this year,high street rentals in Mumbais retail real estate are on the rise. With developers focusing on reducing the current mall vacancy and therefore cutting down on new launches,the lack of quality mall space is pushing retailers towards traditional high streets,according to real estate consultants CB Richard Ellis (CBRE). The limited supply catering to the strong demand have pushed up rentals by 3 to 6 percent in high street locations of Colaba Causeway,Linking Road in Bandra over the last two quarters. In Kemps Corner rentals have gone up by 7 to 8 percent,from Rs 450-475 to Rs 475-500 per sq ft per month. The report states that even relatively newer high streets at Borivali,Powai and S.V Road (Santacruz-Andheri) are witnessing a steady demand. As far as malls are concerned,no new supply is expected until 2013 when Seth developers will launch its one million sq ft large Vivacity in Thane. The slowdown in new launches is despite the fact that over the last six months,several recent malls such as Phase-II of R-City at Ghatkopar,Market City at Kurla and Magnet Mall at Bhandup are witnessing healthy occupancy levels. Rental values are expected to stabilize in mall developments and increase marginally in the traditional high streets,keeping in mind the preference of these locations by domestic as well as international brands that are expected to enter the market in the coming few months. said the report. According to Anshuman Magazine,chairman and managing director of CBRE (South Asia),the expected changes in the FDI regime should propel the demand for organised retail space further. Over the last six months on a pan-India basis,the fresh mall supply of 1.12 million sq ft was less than 20 percent of the 6 million sq ft space added during the same period last year.
