Rentals dip in city’s 3 high streets

Overall the retail sector in India has witnessed the most negative growth amongst all Asian countries. Rentals in Indian high streets corrected in the range of 17 percent to 63 percent over last year which is much higher than the Asia average of 15 percent. The report,however,adds,“Nonetheless,as far as India and China are concerned,the retail sector is better placed to benefit from an upturn in the economy,given that the supply of modern space is constrained in many areas and a young and growing population is supporting increased demand for high quality retail provision.”

The report pegs the reason for the decline to exorbitant and unsustainable rents that existed in these high streets. For instance,Colaba Causeway in Mumbai had witnessed up to 180 percent increase in rents in 2007-2008 making it unviable for retailers to sustain operations at a time when consumer purchases had reduced.

Jaideep Wahi,director of retail Agency at Cushman and Wakefield in India,terms these three markets as the most hyped up areas. “Rentals here were heated up as retail industry works on projections and topline forecasts two years ago were very different. With the slowdown setting in,retailers started rental negotiations and at places where the landlords refused to lower rates,retailers moved out to cheaper high streets,” said Wahi. He also said the retail market in India has stabilised over the last three months.

Meanwhile,New Delhi’s Khan Market has ranked as the 24th most expensive high street in the world with its rentals as high as $234 per sqft annually (Rs 950 per sq ft per month). The world’s most expensive shopping destination,according to the report,continues to be New York’s Fifth Avenue that is followed by Hong Kong’s Causeway Bay and Avenue des Champs Elysées in Paris.