Delhi’s Khan Market has emerged as the most expensive retail location in India, with monthly rentals touching Rs 1,250 a sq ft, according to a survey by consultancy firm Cushman and Wakefield.
While the location witnessed high demand from retailers, rental values have seen only a marginal increase of two%, year-on-year (y-o-y), owing to limited availability and less number of transactions.
At Rs 750 a sq ft a month, Mumbai’s Linking Road is the second most expensive retail location, followed by Connaught Place and South Extension in Delhi.
Rentals at Linking Road have witnessed a correction of 11% in the past year owing to lack of interest from retailers.
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India is amongst the top 10 global markets to record the highest y-o-y rental increase, according to Cushman and Wakefield’s report, ‘Main Streets across the World 2013’.
During the first half of 2013, prime rents in most cities remained stable thanks to steady demand from retailers, particularly from the fashion and food & beverages (F&B) segments. Steady demand from fashion and F&B brands was also the catalyst behind rental increase in India at 2.1%. Overall, activity in India was more restrained than in other major markets.
Sanjay Dutt, managing director (south Asia) at Cushman and Wakefield, said: “Most investors, with the exception of a few, are showing limited interest in shopping centres. India’s main streets continue their appeal as new retailers are trying to create brand presence in key main streets. Large formats are selectively willing to go for stand-alone or built to suit options as well.”
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. India, however, dropped in the global ranking from 26th to 28th position owing 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, the report noted.
Hong Kong’s Causeway Bay remained at the top position as the most expensive retail location in the world, followed by New York’s 5th Avenue and Avenue des Champs Elysées in Paris at the second and third positions, respectively.