Malls see 20-30% sales growth during June quarter from pre-Covid levels

By Raghavendra Kamath

Mall owners are in for good times again as most of these shopping centres have seen 20-30% growth in sales during the June quarter.

“Per square feet trading is higher than pre-Covid times and footfalls are 80% of pre-Covid sales,” said Bipin Gurnani, chief executive of Prozone Intu Properties that runs malls in Aurangabad and Coimbatore.

Sales, he said, are 20-30 % higher than the corresponding quarter in FY 20. Gurnani said all understanding with retailers is back to the terms agreed upon earlier.

He said they are charging minimum guarantee rent or 10% of sales, whichever is higher. “Since sales are good, we are getting the latter. “Brands are paying higher than minimum guarantee rents,” he said.

Malls gave various concessions to retailers during the pandemic, including discounts on rents, full rent exceptions, and so on as sales came to a standstill.

Rajneesh Mahajan, CEO, Inorbit Malls said that they have seen 26-27 % growth in sales in June quarter over the same period in 2019.

Mahajan expects the trend to continue and expecting growth to be in high teens in the current quarter.

“We have seen ‘revenge shopping’ happening after two years of no-shopping.

“Retailers have seen good growth in sales in the June quarter,” he said.

Inorbit went back to the original agreement with retailers after October 2021, he said.

Mukesh Kumar, chief executive of Quest Properties which runs Quest mall in Kolkata said that they have seen 20-25% growth in sales in June quarter compared to the same period in FY20.

Susil Dungarwal, founder at Beyond Squarefeet, a mall management firm, puts the growth in mall sales at 30-35% higher than pre pandemic levels.

“Not only footfalls have gone up, we have seen average bill sizes, conversion rates going up.

“I feel it is because of guilt shopping among shoppers who stayed away from malls in the last two years,” Dungarwal said.

On malls and retailers going back to original agreements, he said not only the terms have returned, malls are charging 20-25% higher for new tenants in stores which have been vacated by brands/retailers earlier.