Chennai suburbs to become attractive retail destination: report

Chennai:

The explosion in residential and commercial developments in Chennai’s suburban areas is likely to make it an attractive retail destination, according to Real Estate Intelligence Service, Jones Lang LaSalle India.

The oversupply that has prevailed in Chennai’s office market has emerged as an innovative opportunity for the city’s retail segment as a few developers are contemplating converting their upcoming office premises into retail destinations, the report Asia Pacific Property Digest – Chennai Office & Retail Real Estate said.

This trend is expected to increase retailer penetration in the city and the suburbs in particular, the report added.

The report said the 150,000square feet Spectrum Mall in Perambur commenced operation in third quarter 2011 with only a 27 per cent commitment. However, the mall is expected to add more tenants in the near future as the hypermarket becomes operational.

“This mall is in one of the key areas in the northern part of Chennai, Perambur, which is known for its industrial clusters, along with established residential catchment areas. The completion of the Spectrum Mall, the first mall developed by the Ganga Foundation, is likely to attract a higher footfall from among the local population in the near future,” the report stated.

The lack of well-established high streets in the suburbs of Chennai, unlike the centre of the city, is expected to be the key driver to the success of malls. The residential populations of Ayanavaram, Tondiarpet and Royapuram are the typical target segments for retailers operating in, or willing to operate out of, the Spectrum Mall, the report said.

The lack of quality mall space has remained a challenge in Chennai and has, in turn, constrained the pace of growth of the organised retail market in the city. However, with good-quality malls in the pipeline, the city is set for a rapid makeover in the near future.