MUMBAI| BENGALURU: The combination of retail and office complexes may not be entirely new to metro cities, but the trend of setting up such combined projects is fast catching on. Developers are now looking at experimenting more with a mixed-use format rather than standalone retail formats, allowing for quality retail on the lower floors and commercial spaces on the upper floors.
Even today, key portions of several office buildings in major property markets are occupied by food & beverages and retail BFSI outlets. Such mixed-use retail developments have opened up a new format that would attract select categories of retailers.
“Of the total retail presence in office buildings across major Tier I cities, a dominant 26% is occupied by food & beverages and a significant 23% is occupied by retail BFSI outlets. While retailers get the dual advantage of paying lower rents compared to premium spaces in Grade A malls, and closer access to their main target segment of office-goers, developers are also open to experimenting more with a mixed-use format rather than a standalone retail format,” said Anuj Puri, country head, JLL India.
Such office-retail complexes (ORCs) are emerging as alternatives to high streets, and even malls, for some categories of retailers. “In business district environments, it is important to bring in an optimum mix of retail spaces, which are best suited within that setting. Essentially food, BFSI related outfits bring life into these business districts and should be planned more to optimise the commercial user and not just retail space, to maximise rental revenues. Correctly planned spaces with supporting infrastructure will flourish. We are seeing a rising trend of the same, where 10-15% of the overall space is earmarked for such retail outlets,” said Vinod Rohira, managing director, K Raheja Corp.
For some time now, retailers have been facing the lack of available quality retail space in right locations. For instance, mobile manufacturing companies would want to open flagship stores in office districts in order to demonstrate new product service offerings. Often, first time buyers of expensive handheld gadgets are office-going employees, and a store in the same ORC would entice them to check out the store and products.
credits ET Realty