Under the new proposal, DLF Shopping Malls is offering rental partners a 100% waiver on MG rent for the entire lockdown period till June 15.
In a first, luxury mall developer DLF has offered its mall tenants, or rental partners, like Reliance Retail, Pantaloons and Big Bazaar, a rent waiver programme, which proposes among other options a 100% off on the minimum guarantee (MG) lease rent.
Under the new proposal, DLF Shopping Malls is offering rental partners a 100% waiver on MG rent for the entire lockdown period till June 15. Post this, a 75% off on MG rent is offered till June 30, sources said. DLF has also proposed a 50%, 24% and 10% waiver on MG rent for July-September 2020, October-December 2020 and January-March 2021, respectively, they added.
The company has seven malls spread over Delhi, Gurgaon, Noida and Chandigarh. Its retail real estate portfolio is around 3.8 million sq ft.
However, to avail this offer shops, eateries, etc have to clear their dues by September-end. They would also have to open their stores within the first week of the mall’s opening. Another condition is that in case a tenant’s sales reach 80% of last year’s sales in October-December period, then 100% MG rent will be applicable.
When contacted, a DLF spokesperson said, “We at DLF value our partners in good and bad times and this is a generous gesture of building the partnership”. In its offer to rental partners, DLF said, “We are mindful that a strong partnership entails sharing of both the good times and bad times. We are sympathetic to the situation you are facing, and we have also been faced with a cessation of revenues whilst our financial obligations to external shareholders have remained. We have worked on a rental programme that will support our rental partners to restart your business”.
It further said, “We at DLF Promenade, Vasant Kunj look forward to your working together and welcome back our customers to a safe and wonderful shopping environment. We will soon be sharing an addendum detailing the terms and conditions for this support programme. In the meantime, you are requested to kindly acknowledge this letter and start your business operations at our malls”.
Industry sources said some other mall operators in southern and western India are also working on similar waivers for their tenants. This would largely be applicable for Q2, Q3 and Q4 of FY21.