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Besides, construction took a major hit during the lockdowns.
With consumer confidence improving, the mall segment has started witnessing rising footfalls, and developers are expected to offload around 4.5 million sq ft (MSF) of new mall space across tier-I and II cities.
“Around 4.5 MSF of new supply is planned for 2021. This new supply will be spread across tier I and II cities of India, with tier I cities accounting for around 90% of the space. About 85% of upcoming malls are likely to be added in tier I cities, and 15% in tier II & tier III cities,” Anarock Retail joint MD Pankaj Renjhen said.
New mall completions, considered an indicator of the sector’s prospects, were phenomenal in 2019, with around 8.5 MSF added across the top 7 cities. This was a staggering 73% annual growth. However, with complete and then intermittent lockdowns laying a serious jinx on the sector from March 2020, consumers were under house arrest and buying only essentials via e-commerce portals, Anarock pointed out.
Besides, construction took a major hit during the lockdowns. There were severe supply constraints as well as a shortage of semi-skilled and unskilled construction workers, it added.
On the break-up of the 4.5 MSF of mall supply hitting the market, Renjhen said Noida has around 1.1 MSF of new space planned for 2021, across three malls. Bengaluru is likely to witness new space completion of 1.22 MSF, spread across two malls. This city is primarily driven by IT-ITeS companies whose business has not been negatively impacted by the pandemic.
Besides, Mumbai is likely to add only 1.1 MSF of space spread across three malls. The city witnessed significant mall supply addition in the recent past and so it seems to be going slow for now. Lucknow and Amravati are among the tier-II cities which collectively have nearly 4.7 lakh sq ft of mall space addition planned for 2021, across two malls, he added.
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