Unitech will invest Rs 20,000 crore, plans 48 new malls in six years

India’s second largest realtor Unitech Ltd has announced a Rs 20,000-crore investment...

India’s second largest realtor Unitech Ltd has announced a Rs 20,000-crore investment to develop 48 malls and shopping centres across the country in the next six years, in a bid to expand its presence in the organised retail sector.

Unitech currently has two operational malls in Noida and Delhi. After the proposed expansion, the number would reach 50 by the end of 2013. The company plans to develop over 60 million sq ft of retail space through these malls and shopping centres.

“In the first phase, Unitech will develop 24 malls covering more than 20 million sq ft,” the company’s managing director Sanjay Chandra said. To start with, the company is targeting metros and major state capitals for its retail expansion and will gradually move to Tier-II and Tier-III cities, Chandra added.

Of the 24 malls and shopping centres planned in the first phase, 18 are at the designing stage, while construction work has started on six malls. In the first phase, the company will develop malls and shopping centres in the NCR, Mumbai, Kolkata, Chennai, Bangalore, Hyderabad, Chandigarh, Dehradun, Lucknow, Bhopal, Goa, Vizag, Bhubaneshwar, Kochi and Trivandrum.

Each of the proposed eight malls in the metro cities would be one million sq ft in size. The Gurgaon-based firm will follow its existing business model of mixed use developments for all its malls to ensure more footfalls. In the existing two malls, Unitech has built amusement parks.

The mall in Chandigarh will also have an entertainment park, while a convention centre will be built in the one developed in Kolkata. The company would follow similar mixed use models for other malls.

Unitech — which has a land bank of about 20,000 acres with a saleable area of 850 million sq ft — is using its existing resources for the first phase. Land acquisition process is underway for the rest of the expansion.

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The company will lease out all the new retail spaces to prospective retailers. In addition to the minimum rentals, it would also enter into revenue sharing agreements to ensure better long-term gains. Unitech has formed a specialised team to promote its malls and shopping centres and boost sales.

According to global realty consultant Cushman & Wakefield, the percentage of organised retail in India stands at 4.6 per cent as compared to developed economies. Organised sector accounts for 80 per cent and 70 per cent of retail operations in the US and UK respectively. “The figure, however, indicates the immense scope and potential of the retail sector to flourish in the country,” the consultant said in its latest report.