Embed Size (px)
Citation preview
Page 1
Mall Representation ProposalMall Representation Proposal
for for t thehe
RIVERSIDE MALL & HOTELRIVERSIDE MALL & HOTEL
ByBy
Chennai. May 2007
Page 2
Presentation Flow
• CHENNAI MALLS – A SNAPSHOT
• RIVERSIDE MALL & HOTEL – LOCATION & DEVELOPMENT
• C&W APPROACH & METHODOLOGY
A. Objectives B. Trade & Tenant Mix C. Formats & Rate card D. Transaction Dynamics & Timelines
• PROJECT MARKETING PROCESS
• C&W MALL MANAGEMENT – THE FUTURE
Page 3
Chennai Malls – A Snapshot
Page 4
Chennai - Mall Retailing Outlook
The first organized Mall retailing started with Spencer Plaza in 1991.
Multiple mall developments are at various stages of planning and construction as on
Date. Both national and local developers are in a mall development spree.
Chennai shall witness a supply of over 10 million Sq.ft of retail space over the next 12 to
30 months. Retail development in the city is spread across the various residential pockets
Existing malls in the CBD have achieved rental in the range of Rs. 80-110/Sq.Ft/Month
(Ground Floor) . However rates would vary with location and size of development
A quality product with the right positioning for an upcoming mall can attract a premium
of about 10-15%
Page 5
Page 6
…Continued
Page 7
THE RIVERSIDE MALL Location & Development
Page 8
Location Details
On the Old Mahabalipuram road or the designated IT Highway. The site has dual frontage, ideal for a retail development
Unique site location as it lies on the riverside and hence a huge scope for activities that would connect both the internal and external environments of the Mall.
The older residential catchments namely Adyar, Thirvamyur, Besant Nagar & the fast developing Velachery area would be 10 mins away once the 6 lane roadway is up and running
Residential activity on the IT Highway is growing at a scorching pace due to the demand from the employees of the IT/ ITES industry.
Located again strategically at a key node of the IT Highway, OMR, a stretch that is to house more than 20 million sqft of IT space
Overall the site is ideal for a mixed development of retailing & hospitality.
Page 9
Development Details
Thirvamyur, ECR
Adyar Besant Nagar
IT Highway
Land extent is of 7.3 acres. Frontage on OMR is 300 ft. A second frontage on the riverside is off 800 ft
Proposed Mall, Entertainment & Hospitality of close to 1 million sqft
Lease able Mall area over 5 levels with a floor plate of more than 1 lakh sqft
Lower ground – Hypermarket & Vanilla retailing
Ground, first, second would cater to shopping with a scattering of F&B
The 5 screen multiplex would be housed on the 2nd & 3rd floors
The Food court and Entertainment would be housed on the 3rd floor
Two car parking basements for the Mall : 700 + car parks
Multiple level car parking adjoining the hotel block for the hotel.: 200 car parks
Page 10
C&W APPROACH & METHODOLOGY
Page 11
Objectives1. Primary Objectives2. Market positioning3. General Mall Formats – an insight
Trade & Tenant Mix1. Primary Deliverables2. Identifying Trade Mix3. Identifying Tenant Mix4. Prevailing Trade Break-up in Organised retailing – an insight
Formats & Rate Card1. Pricing2. Space Format
Transaction Dynamics & Timelines1. Client Selection2. Leasing
C&W A&M
Page 12
OBJECTIVES
Page 13
Primary Objectives
To maximize the business potential from the mall, i.e. maximum sales per sqft per day by
Market Positioning relevant to the development
Optimizing Trade & Tenant Mix
Achieve desired financials keeping in mind market dynamics
Page 14
Market positioning
To project the location and catchments
Advantage of the size & development mix
Vision of developer
The tenant profile present & planned
The design and architecture
Parking , amenities and services
The Mall management
Page 15
General Mall Formats
Mega Malls - Multiple department stores, hypermarket, entertainment & restaurants 600,000 + SQFT
Eg. Unitech’s Great India Place Noida
Regional Malls - Anchored by department store, hypermarket & multiplex 400,000 – 600,000 SQFT
Eg. Forum Bangalore, High Street Phoenix Mumbai, Inorbit Mumbai
Sub-Urban Malls - Located in sub-urban areas & tier-II cities / towns; anchored by department store(s) & multiplex 200,000 – 400,000
Eg. MGF Metropolitan; DLF City Center Gurgaon
Value Malls - Malls competing on price with hypermarket as anchor tenant; targeted at middle-income group150,000 – 200,000
Eg. Sahara Mall Gurgaon
Specialty Malls - Focused on one product category, theme or targeted consumer segment 150,000 – 250,000
Eg. Gold Souk Gurgaon, DLF Emporio Delhi, Ishanya Home solutions Puna
Page 16
TRADE & TENANT MIX
Page 17
Primary Deliverables
To ascertain Trade Mix To maximize the business potential in each category To bring complimenting trades to complete the shopping experience Right sizing the space allocation to each product category
To ascertain Tenant mix To provide wider product options to customers vertically and horizontally Bring complimenting brands to maximize business potential
To maximize rental values To have a pricing strategy for mall to achieve better rental values Increase the business potential by pre-leasing a select % of retail space
only and leaving room for new entrants when the structure is complete. Better rentals would also be derived by the above method.
Page 18
Identifying Trade Mix
To arrive at a break-up of space occupied by the various trades
24%
19%
16%2%1%
12%
2%
6%
2%2%2%2%
10%
Hyper
Anchor
Apparel
Gifts
Jewelry
F&B
Shoes
Services
Acessories
Home
Electronics
Books
Entertainment
Page 19
Identifying Tenant Mix
To arrive at the number of outlets for each TradeTo arrive at the shop floor areas for the outlet
1. Premium brands
2. Bridge to Premium Brands
3. National & international brands
4. Local brands for city flavour
5. Unbranded retailers to create an USP of variety
Page 20
FORMATS & RATE CARD
Page 21
Format - Type & Trade
Space Format-wise 1. Vanilla Store
2. Hypermarket
3. Departmental Store / Large format specialty store
4. Multiplex
5. Food court / Entertainment Zones
Trade Category/ Zone -wise 1. Ground + First floor – Apparel, Books & Accessories, Jewellery &
Watches, Footwear.
2. Second & Third Floor - Home Stores, Consumer Durables, Electronics, F & B, Furniture & Furnishing, Entertainment.
Page 22
Space Format Allocation
23%
18%
14%
14%
12%
4%
5%
10%Hypermarket
Department
G Vanila
F Vanila
S Vanila
S mini anchor
Multiplex
Food
Page 23
RATE CARD
Page 24
Rate – Area Matrix LG, G & F Levels
Lower Ground Carpet Area ( sq.ft.) SBA ( sq.ft.) Lease term Efficiency Monthly Rental @
Rental 35/ 100
Hyper Mall 94000 117500 15 yrs 80% 4112500
Vanilla 25000 37313 6 yrs 67% 3731343
Total 119000 117500 4112500
Ground Floor Carpet Area ( sq.ft.) SBA ( sq.ft.) Lease term Efficiency Monthly Rental @
Rental 45 / 80 /110
Anchor 22000 27500 12 to 15 yrs 80% 1237500
Mini Anchor 8000 11940 6 to 9 yrs 67% 955224
Vanilla 35000 52239 6 yrs 67% 5746269
Total 65000 91679 7938993
First Floor Carpet Area ( sq.ft.) SBA ( sq.ft.) Lease term Efficiency Monthly Rental @
Rental 42 / 70 / 100
Anchor 22000 27500 12 to 15 yrs 80% 1155000
Mini Anchor 7800 11143 6 to 9 yrs 70% 780000
Vanilla 35000 52239 6 yrs 67% 5223881
Total 64800 90882 7158881
Page 25
Continued… S & T Levels
Second Floor Carpet Area ( sq. ft.) SBA ( sq.ft.) Lease term Efficiency Monthly Rental @
Rental 60 / 70 / 85 /40
Mini Anchor 20000 28571 6 to 9 yrs 70% 1714286
Fine dining 5000 7463 6 to 9 yrs 67% 522388
Vanilla 30000 44776 6 yrs 67% 3805970
Multiplex 42000 52500 15 yrs 80% 2100000
Total 97000 133310 8142644
Third Floor Carpet Area ( sq. ft.) SBA ( sq.ft.) Lease term Efficiency Monthly Rental @
Rental 40 / 70 / 80 / 50
Food court 50000 62500 9 to 12 yrs 80% 2500000
Fine dining 10000 14925 6 to 9 yrs 67% 1044776
Toys store 5000 7463 6 yrs 67% 597015
Entertainment 15000 21429 9 yrs 70% 1071429
Total 80000 106317 5213220
Page 26
Overall Commercials
FROM THE RATE - AREA MATRIX WE DERIVE *
• TOTAL LEASEABLE AREA 5,40,000
• OVER ALL MALL EFFICIENCY 72 %
• TOTAL RENTAL AMOUNT / ANNUM 40 Cr
• AVERAGE RENTAL / SQFT / MONTH Rs 60
Deposit for Anchor & Vanilla stores 10 months
Escalation for Anchors 12 % every 3 years
Escalation for Mini anchors / Vanilla stores 15 % every 3 years
* The mentioned figures could vary from the final as layouts are in process of change
Page 27
TRANSACTION DYNAMICS & TIMELINES
Page 28
Mall Leasing Dynamics
Insights from the past
• Mall rentals at markets like Delhi & Mumbai have escalated by 200 % from start of project to structure completion stage. They failed to accumulate the benefit due to hasty preleasing
• Key malls have been fully leased out a year back, and are yet to start operations for various reasons making it either outdated or unavailable to today's new retail entrants.
• Lack of variety in retail formats as marketing of space is rarely done by innovative practices and more carried out by immediate need to lease
• Mismatch in the numbers of Anchors versus Vanilla stores thus creating an experience imbalance at a mall
Page 29
Mall Leasing Dynamics
Way forward
• The Mall to be marketed in a phased manner to understand its relevance to market dynamics and ground realities at every stage
• Key formats to be roped in to enhance the Malls brand image to form the stage for further leasing.
• 30 to 35 % of shops to be leased out only during the nearing of structure completion, resulting in the below outcomes;
A. Making room for new retail entrants both International & National
B. Delivering higher rental values for a near completed Mall as occupation can be done almost immediately
C. Higher competition among retailers both National & International would further drive rentals
Page 30
Hotel Block
• A luxury or business class hotel would be targeted for this development due to the following attributes
A. 200 plus rooms in a 2 lakh sqft hotel block B. Room sizes vary from 250 sqft to 350 sqft C. Being a part of a riverside development would accentuate its ambience
• The Hotel transaction could be worked out in the following methods
A. A minimum guarantee amount or revenue share whichever is higher B. A Joint venture model C. Sale of hotel block
Page 31
0
10
20
30
40
50
60
70
June.2007 July.2007 Aug.2007 Sep.2007 Oct.2007 Nov.2007
% Leased
Simultaneous leasing across the various formats starting with anchors keeping in mind the brand & store size mix
LOI / MOUs signed as confirmation with partial payment of deposit is taken into account for this chart
At least 30 % of space would be held back to be leased at a later date or when near completion of construction
Leasing Time Lines
Page 32
PROJECT MARKETING PROCESS
Page 33
Project Marketing Process
Pre Leasing
Concept finalization & creative strategy to optimize development layout
Title documents
Demographic Study
Project Presentation to C&W Retail team
Resource allocation
Resource Orientation on the project
Financial Analysis
Assessment of CAM Charges
Finalization of Transaction documents
Page 34
Project Marketing Process
Leasing
Marketing by Invitation & Client Selection
Presentation of Project
Space Allocation
Negotiations
Filing of discussion Progress
Documentation
Progress reports to the developer
Progress report to retailers signed
Filing of documentation
Page 35
Project Marketing Process
Post Leasing
Fit-out guide
Finalization of house rules
Invitation to possession
Online information kit to retailers
Planning of Mall Launch
Handing over to developer
Option of Mall Management Services
Page 36
C&W MALL MANAGEMENT THE FUTURE
Page 37
Mall Management Services
Currently this service line is active in Europe and the same is in
the process of being set up in India in the coming months.
Asset Management – Operations, Security, Services & Car parking management
Marketing & Promotions – Indoor & outdoor publicity for branding and promotions. Space
selling at the Mall
Finance & Administration – Rent collection, renewal of contracts
and monitoring of house rules.
Page 38
Thank you
