 "Delhi's Khan Market beats Mumbai's Linking Road as costliest retail street")
New Delhi’s Khan market has emerged as India’s most expensive retail street while Mumbai’s Linking Road is the second most expensive, followed by Connaught Place and South Extension in Delhi, according to a survey by real estate consultancy firm Cushman and Wakefield.
Khan Market witnessed high demand from retailers but due to limited availability and transactions, rental values have only seen a marginal increase, even though its global ranking drops two places to 28, the survey showed.
While Khan Market recorded monthly rentals of close to Rs 1,250 a sq ft, (up by just 2 percent from the year-ago period), Mumbai’s Linking Road recorded a monthly rental of Rs 750 a square foot. According to the report, rentals at Linking Road have witnessed a correction of 12 percent in the past year owing to lack of interest from retailers.
Delhi’s South Extension also made the list, recording an annual rental growth of 20 percent.
[caption id=“attachment_1249069” align=“alignleft” width=“380”]  Khan market emerges as costliest retail destination[/caption]
India is also amongst the top ten global markets to record the highest rental increase year on year as per Cushman & Wakefield’s annual report ‘Main Streets across the World 2013’. The report is widely recognised as the barometer for the global retail market and ranks the most expensive locations in the top 334 shopping destinations across 64 countries.
Mumbai’s Linking road ranked 11th in the survey for sharpest declines globally.
Once popular with brands for opening their flagship stores, it has been witnessing competition from some upcoming shopping centres in the vicinity which retailers prefer on account of better amenities and lower rentals.
Impact Shorts
More ShortsMoreover, Linking Road also suffers from aspects like poor accessibility, parking and other amenities.
In the global ranking of most expensive retail locations, Khan Market stood at 28th position, retaining its position as the most expensive retail location in India.
Khan Market however, dropped in the global ranking from 26th to 28th position due to the weakening of the Indian rupee against the US dollar and largely stable rentals with limited increment in rental values in established retailing sectors," it added.
The report names Hong Kong’s Causeway Bay as the world’s most expensive retail location, followed by New York’s 5th Avenue.
Kutuzovsky Prospekt in Moscow, Russia recorded the highest rental growth of 42% year on year.
Sanjay Dutt, executive managing director, South Asia, Cushman & Wakefield said, ‘‘Retail rentals globally registered a slower growth of 3.2 percent as compared to the previous year on account of slowdown in economic uncertainties in the leading markets. The Asian markets saw a better average of rental increase at 4.5 percent in the same period. Economic risks remain for 2014 but conditions are expected to steadily improve across most markets."
The retailers’ push towards the best and most sought-after locations will continue. However, limited supply and higher rental costs will create obstacles for some brands, leading a number of retailers to look at alternative locations in close proximity to the main thoroughfares, he added.
And since new age retailers are focused on providing an experience to their customers beyond just merchandise, they are showing preference for quality shopping malls that offer the right amenities.
‘‘Going forward we can expect some of the well managed shopping centres in key locations to start commanding significant rental values at par with main streets as retail malls are now increasingly positioning themselves as destinations with a few even going as far as putting added attractions like adventure rides etc. apart from high end cinema and F&B," Dutt said.
In Mumbai for instance, destination malls, speciality malls and luxury shopping centre developments are being explored.
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