DLF mall retailers demand 50% reduction in rent
Sunday Business Standard, April 12, 2009, Page 3
Neeraj Thakur & Pradipta Mukherjee / New Delhi/kolkata
DLF, the country’s biggest realty developer, is facing protests from retailers over rentals and maintainence charges.
The majority of the retailers at DLF Place Saket and DLF Place Vasant Kunj, both in New Delhi, have downed shutters demanding a reduction in rentals and maintenance charges, while retailers at DLF Emporio (India’s first luxury mall) are contemplating shutting shop, if the management does not reduce rentals by 50 per cent.
Tarun Maglani, spokesperson, Mall Welfare Association, DLF Place, Vasant Kunj, claimed that 80 per cent of storeowners at DLF Place Saket had pulled down their shutters. DLF Place, Saket opened in November last year; DLF Place, Vasant Kunj opened in January.
DLF is already facing protests from home buyers at its Garden City project in Chennai and New Town Heights project in Gurgaon.
“DLF’s malls charge the highest rentals and maintenance fee, with little emphasis on mall design and providing facilities. There are virtually no footfalls as the company has failed to attract the right mix of retailers,” Maglani added.
A DLF spokesperson declined to comment on the charges. Though, retailers at DLF Place Saket and DLF Place Vasant Kunj, are under the rent free-period plan till May, they would have to pay the rentals contracted three years ago, at the time of booking the stores, company officials said.
“We were promised that the food court and the multiplex would be functional by the time the mall opens, but till today the multiplex is not operational and the food court is 25 per cent operational,” said Akash Oberoi, president, Mall Welfare Associaiton, DLF Place, Saket.
Retailers are demanding 50 per cent reduction in their rentals, or that the rentals be the on a par with rentals offered to new retailers. “Today, if the company can offer a better deal to its new retailers, it should give the same treatment to all retailers,” said Maglani who runs a chain of saree retailing stores at four other malls in Delhi.
“We are facing this problem only in DLF malls. Our stores in other malls are doing well,” he added.
Retailers of international brands are also feeling the pinch. International apparel and footwear retailer Adidas is also concerned about the low revenue generation at DLF’s Vasant Kunj and Saket Malls.
“We are not planning to move out of the malls immediately, but lack of footfalls is a concern. We are able to generate only 20-25 per cent of business of oour estoimates,” said Andreas Gellner, managing director, Adidas India.
Retailers at DLF Emporio are facing the same problem.
“The old tenants are paying around Rs 1,500 per sq ft as rental including maintenence fee, while the new retailers are paying just Rs 500 sq ft.”, said AK Jain, president, DLF Emporio Retailers Association. Jain is also the president of the retail brand De Grisogono that operates in an area of over 1,000 sq ft. “ Our store is incurring a loss of over Rs 20 lakh per month as there are very few customers. We can not survive for long with such losses,” Jain added.
The DLF mall management will meet members of the retailers association this Friday.
“We want the management to reduce the rentals or we will have to close stores,” Jain said.
Sunday Business Standard, April 12, 2009, Page 3
Neeraj Thakur & Pradipta Mukherjee / New Delhi/kolkata
DLF, the country’s biggest realty developer, is facing protests from retailers over rentals and maintainence charges.
The majority of the retailers at DLF Place Saket and DLF Place Vasant Kunj, both in New Delhi, have downed shutters demanding a reduction in rentals and maintenance charges, while retailers at DLF Emporio (India’s first luxury mall) are contemplating shutting shop, if the management does not reduce rentals by 50 per cent.
Tarun Maglani, spokesperson, Mall Welfare Association, DLF Place, Vasant Kunj, claimed that 80 per cent of storeowners at DLF Place Saket had pulled down their shutters. DLF Place, Saket opened in November last year; DLF Place, Vasant Kunj opened in January.
DLF is already facing protests from home buyers at its Garden City project in Chennai and New Town Heights project in Gurgaon.
“DLF’s malls charge the highest rentals and maintenance fee, with little emphasis on mall design and providing facilities. There are virtually no footfalls as the company has failed to attract the right mix of retailers,” Maglani added.
A DLF spokesperson declined to comment on the charges. Though, retailers at DLF Place Saket and DLF Place Vasant Kunj, are under the rent free-period plan till May, they would have to pay the rentals contracted three years ago, at the time of booking the stores, company officials said.
“We were promised that the food court and the multiplex would be functional by the time the mall opens, but till today the multiplex is not operational and the food court is 25 per cent operational,” said Akash Oberoi, president, Mall Welfare Associaiton, DLF Place, Saket.
Retailers are demanding 50 per cent reduction in their rentals, or that the rentals be the on a par with rentals offered to new retailers. “Today, if the company can offer a better deal to its new retailers, it should give the same treatment to all retailers,” said Maglani who runs a chain of saree retailing stores at four other malls in Delhi.
“We are facing this problem only in DLF malls. Our stores in other malls are doing well,” he added.
Retailers of international brands are also feeling the pinch. International apparel and footwear retailer Adidas is also concerned about the low revenue generation at DLF’s Vasant Kunj and Saket Malls.
“We are not planning to move out of the malls immediately, but lack of footfalls is a concern. We are able to generate only 20-25 per cent of business of oour estoimates,” said Andreas Gellner, managing director, Adidas India.
Retailers at DLF Emporio are facing the same problem.
“The old tenants are paying around Rs 1,500 per sq ft as rental including maintenence fee, while the new retailers are paying just Rs 500 sq ft.”, said AK Jain, president, DLF Emporio Retailers Association. Jain is also the president of the retail brand De Grisogono that operates in an area of over 1,000 sq ft. “ Our store is incurring a loss of over Rs 20 lakh per month as there are very few customers. We can not survive for long with such losses,” Jain added.
The DLF mall management will meet members of the retailers association this Friday.
“We want the management to reduce the rentals or we will have to close stores,” Jain said.
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