In India, public-private partnership in the shopping centre context influences how developers look at everything from traffic management to power supply, waste disposal, building regulations and access to capital. Developers find themselves leading the way in introducing international best practices in their developments, whether by creating vast databases of research or by example. Creatively, developers in India have to find ways to work around regulations that are not as easily updated, looking for opportunities in challenges.

Government actions, and not just laws and regulations affect developers’ finances. The government becomes an important stakeholder with enormous power to affect economic value. A recent McKinsey survey found that a majority of mall executives say business must proactively and regularly engage with government and that government has a crucial and expanding effect on companies’ industries and economic value.

At the Indian Shopping Centre Forum 2010, Nipun Sahni, MD & Head, real estate investments-India, DSP Merrill Lynch Capital, commented on the Indian government approving foreign investments in the shopping centres space. He said: “Initially, investors looked to invest in residential property, but now shopping centres, too, are graduating to the retail asset class.” He also said that it would be some time before India can reach the levels of Singapore and Australia.

Developers seek government support with regard to resource allocation for an industry that is a major generator of jobs today. Ajay Gupta, CEO, West Pioneer Properties, developer and operator of malls in West and South India, says: “When you look the mall economics, a large part of the cost is the land cost. There is an opportunity in joining hands there, if an area for a mall is reserved and then given out to developer with retail background, and not developers who are just developers.”

He cites examples of other industries such as hospitality where hotels are not only given reserved land but to encourage development there are relaxed FSI norms. A developer who has a hotel gets extra FSI to be used in other parts of the development. There are examples in the organised retail sector as well. In Delhi, for instance, the Delhi Development Authority actively encouraged high street projects which led to the state getting VAT returns of Rs120 crore a year from one shopping mall alone.

Kishore Bhatija, CEO, Inorbit Malls, with malls in mumbai, Hyderabad and soon Pune, says that the government can often be a facilitator. “The government wanting to encourage a particular industry introduces single window clearances... nodal authorities meet at regular intervals as a single committee to expeditiously clear proposals.”

Infrastructure can hugely impact a shopping centre’s success. Shrirang Sarda, CEO Sarda Group, the developer of the Nasik City Centre, says, “We need to engage with the government at various levels, such as with the municipality and the traffic police department at the basic urban planning level. He recommends a collaborative approach with the government. “Take traffic, for instance,” he says. “Access is important. We attract footfalls and it generates fair amount of traffic. And it needs to be handled well. On safety and fire issues we need to interface again. We have fire drills with the police and the fire department. We have done this exercise in a live mall, and not as a paper exercise. We call them, and collaborate. They also understand what to deal with. What we are ready with and what we are not. We have to depend on them for the large fire-fighting apparatus. We have sprinklers, detectors but we need to work in sync for this,” he says.

In India lack of quality infrastructure means that the convenience factor, all important for consumer footfall, breaks down. We often find that infrastructure development is always been in bits and pieces, not on a scale where it should be. “From the backend perspective it is a bigger issue. For all these formats to be successful, supplier replenishment cycle needs to be in place. Can we get big trucks in, for instance?” says Gupta.

Regulations can change the way a mall turns out, sometimes for better. The best practice may be to work with them. “The simplest strategy is to accept the regulation, understand why it there and how it helps business. How can one leverage it for the business? For example, if we use less water and electricity, there is less dependence on the corporation and cost savings in the long run. Don't just play lip service, regulations can help the business,” says Sarda.

Regulations do need to move with the times. “The consumer profile, behaviour and, most importantly, lifestyle is changing. Working night shifts is common... The average consumer expects to see a film at 7am, post work just like everybody else. Rules have to be modified accordingly. Everything needs to be available 24/7. People expect things to be available whenever it is convenient for them,” says Bhatija.

Arjun Sharma, Director, Select CityWalk told Mall Talk in an earlier interview that the mall worked with many external controls on heights, parameters of the structure etc. “Typically, malls are shoebox structures. We managed to convince the authorities that the mall is conceived to be an outward looking project,” he said.

In the industry, there is much appreciation that there is a platform where this can be made possible. “That is one of the core objectives of SCAI. At the moment, shopping centre developers are engaging at individual levels with the government. I believe it would be more meaningful and effective if issues are handled as a single unified entity. The government would also be more responsive if we are collectively represented,” says Kishore Bhatija.

Forward looking developers such as Gupta and Sarda both think that vision is one of the most important components in the person who deals with the public sector, creating which are for the future. Whether it is creating more parking than required, keeping in mind vehicle density rather than regulations or working with environmental best practices, mall developers lead by example. Developers feel that India being a developing economy doing more than the requirement may be more productive in the long run.

Sarda believes that the public-private partnership should go one step ahead. “We engage with the public. We have created an NGO which is located out of the mall. We train them on candle making and then the candles are retailed in the mall, by a micro-entrepreneur. So we try to ensure access to money, knowledge and market.”

On Republic Day a couple years ago, West Pioneer’s Metro Junction in Kalyan invited the parents of one of the army-men who died in Kargil, who lived in the suburb, to do the flag hoisting.

At Inorbit Malad and Vashi, a monthly community programme involving 90 housing societies in each catchment area has been introduced. One session was about training office bearers of these societies in rainwater harvesting. Another initiative, Live at Inorbit, is where an upcoming bands connect with the youth in an unplugged environment within the mall, without any ticket to be bought.

Sarda says, “Public-private partnership can go beyond the government. We can directly go to the public. It is good for the community. That is what is public. That is the mandate of the government as well.”

-By Shalini Seth

The way to the consumer’s heart

Food is indeed the way to the consumers’ heart. Well, what do they want?

The specificity with which the Indian consumer demands food is well-known and documented. We want variety, taste, health and region-specific cuisine wherever we go. We asked a few shoppers about what they love about food in a mall and what they would want.

“The best thing about food in malls is that there is something for everyone,” says Sneha Rathod, a travel professional based in Delhi. Rathod finds it easy and cost-effective to take guests and family to a mall for an evening out, offering them snacks or dinner, according to their choice.

“I like the fact that to make everyone happy all I have to do is visit many counters at the food court. My aunt would prefer idlis when eating out, my cousin was only happy with chappatis, his dad always wanted butter chicken and my children would want either chaat or pasta. Eating out was not a great option earlier. Either we would end up ordering at home or going to an average multi-cuisine restaurant where no one would be very happy with how unauthentic the cuisine was,” she says.

Malls in India have changed all that. One of the first entrants in food courts were already established restaurants which expanded via the franchise route. “I like the fact that I can enjoy Kailas Parbat without going to Colaba,” says Parul Mehta, a former bank executive, who lives in Mumbai.

For many others, the assurance of hygiene scores over many other factors. “Cleanliness is very important and not something you can guarantee is many places outside a mall. Along with that I am happy that I can take some special needs food and not be faced with a warning of ‘outside food not allowed’,” says Rashika Bajoria, a resident of Malad in Mumbai. She often has to carry special food for her mother-in-law who has many food restrictions.

On the positive side is the variety of food, clean surfaces and hygienic delivery, with the availability of known names. But there are food court concerns as well. “I have often found that the franchises of major brands compromise on quality and variety when in a food court. In fact, sometimes you want to order the very thing that they are famous for and because the ingredients are perhaps not the most easily available in bulk, you find that it has been taken off the menu,” says Rathod. Her solution? “When drawing up a contract, the USP of the restaurant should be considered and be made a part of the format,” she says.

Standalone restaurants inside malls are another demand of the maturing customer. “Sometimes we would like to explore a new place, spend a little more for the ambience and that is not really possible in most malls,” says Mehta.

“Noise levels,” says Bajoria when asked about her wish-list from food courts. “Indians are generally a noisy lot and our children are boisterous. Sometimes in a food court you cannot have a conversation. Maybe in India, one can install noise-cancellation curtains or something the way they have them around flyovers and hospitals or one can create special zones for families with or without children,” she says.

Quick access to tables, directions of use for dustbins and civic notices are some of the other things consumers pointed out. “I find that Indians expect attendants to pick up after them. It is all our responsibility to create civic shoppers who don’t leave a dirty table. I also find that some people, probably new to the whole mall set up, may not know what goes in the dustbin” says Rathod. She suggests that just as hotels encourage guests to preserve the environment by not throwing the towel in for a wash everyday, shopping centres can encourage civic behaviour.

“By all means, have alert attendants but perhaps on the table and on the dustbin itself, the shopping centre management can paste instructions on how to leave the table neat for the next user by following simple directions,” she says, reassuring that most of her acquaintances would be happy to do so if they were told how to.

Indian shopper is not only a foodie but a responsible one at that!

- By Shalini Seth

Vivacity Thane gets a good retail mix

Sheth Developers, the ones behind Thane’s upcoming Vivacity mall have told the media that nearly half the space at its upcoming 1 million sq ft mall has been tied up, as commercial real estate market picks up.

Shopper's Stop and Hypercity, as well as Mexico-based multiplex chain Cinepolis are said to be contracted as anchor tenants for the under-construction mall.

The leasing work had not seen very healthy growth during the slump but is now said to have picked up. The mall is scheduled to start operations by August 2011 and has a total saleable area of 670,000 sq ft.

Mall earns pat on the back for saving energy

DLF Place mall in South Delhi has come to the attention for environmental activists for creating sustainable practices. The mall has its own captive source – generators that run on compressed natural gas (CNG) – benefitting the 160 shops, 45 offices, a hotel and a six-screen multiplex. The air conditioning runs on exhaust from these generators.

Three generator sets produce 1.4 MW each, the generators recover the exhaust and channelise it to vapour absorption machines (VAM). The energy provided by exhaust gas equals to 1,500 tonnes of air-conditioning. These facts were noticed by a noted environmental publication, Down to Earth. The VAMs, imported from China, help reduce the capacity from 1.8 MW to 1.4MW. As in the case of CNG car engines, generators running on CNG use only 40 per cent of the energy produced by the fuel; the rest escapes in the form of heat.

The installation that generates electricity using CNG and then uses the exhaust gas or waste heat for cooling the mall – called combined heat and power (CHP) system is installed already in five office and mall complexes. The management plans to install five more.

According to the International Energy Agency, the share of CHP in power production is more than 50 per cent in Denmark, compared to 5 per cent in India. In Denmark it is used for heating purposes, while in India it’s used mainly for cooling. Fluctuating CNG prices and high initial cost become deterrents for its more frequent use.

Lonavla to get a mall

The tourist-heavy hill station, Lonavla, an hour’s drive from Mumbai is the location of a 1.5lakh sqft mall at a cost of Rs 100 crore being developed by Dhanlaxmi Builders and Developers. Research has it that on an average 62,000 visitors come to Lonavala during weekends – Friday through Sunday – annually. More than 60 per cent of the tourists are from Mumbai and Pune, travelling there about thrice a year.

The idea came from the concept of ‘Mall road’ in hill towns such as Darjeeling, Mussoorie, Shimla, Nainital, reports say.

Being based in a Tier III town, the mall has the additional challenge of catering to tourists who inhabit Mumbai and Pune, both famous for their commercial development. A mix of national and local retailers is on the cards. The mall has also been designed to cater to the local population of Lonavala, Khandala, Khopoli and Talegaon as well. The mall will have a three screen multiplex, a 20,000 sqft family entertainment centre with high-tech rides, kiosks and gaming, and a multi-cuisine food court spread over 21,000 sqft with over 13 kitchens.

The initial revenue expectation is Rs 12,000 a sqft. Anchor tenants get concessions and pan India ones are free to work on revenue-sharing models as well for the mall that is expected to be operation early next year.

Segece gets a new India MD

Segece Group, a leading shopping centre development and management firm in Europe, has said that it has appointed Nicolas Delarocque as the new managing director of its India operations.

Prior to his new assignment, Delarocque was posted in Segece France, where he handled commercial activities for northern and western France, the company said in a statement.

"We want to have someone of Nicolas's experience leading the company in innovation at a time when we are quickly emerging as one of the key players in our field in the country," Segece Group Director-International Commercial Alain Vergne said.

Delarocque had earlier worked with brands like 'Mousquetaires', the supermarket distributor in Europe, and 'Go-sport'.

A post-graduate in retail development, Delarocque had been with the Segece Group for more than four years. He was earlier responsible for the setting up and leasing of 17 shopping centres across France.

Segece India has been leasing space in some of the best shopping centres across India for the past two years.

The Segece Group is the leader in shopping centre development and management in Europe. A subsidiary of BNP Paribas, manages close to 400 shopping centres across 13 European countries with around 19,300 leases and 5.2 million sqm of space.

s.Oliver makes its first stop in Mumbai

s.Oliver, a European fashion brand, has announced the opening of its new store at Mumbai in Inorbit Mall, Malad.

The company wants to be known as the most preferred brand in the premium fashion brand category according to Amit Rai, Chief Executive Officer, s.Oliver India.

This store will showcase s.Oliver casual (women and men) and QS by s.Oliver (female and male) segments along with s.Oliver accessories (bags, belts, scarves), s.Oliver fragrances and s.Oliver umbrellas. The entire store interior design has been conceived and developed in European design studios.

Already, s.Oliver is currently available in Mumbai at three other points of sales – one exclusive store at Mega Mall, Oshiwara (1500 sq ft) and two shop-in-shops at Shopper’s Stop, Andheri and Shopper’s Stop Juhu.

s.Oliver is also looking to mark its presence in South of Mumbai later this month with the opening of a shop-in-shop at Lifestyle, Phoenix High Street. With plans to continue building a strong presence in Mumbai, s.Oliver is aiming to open three to five more point of sales in the next six months with the idea of targeting various other catchment areas such as New Mumbai (Thane), South Mumbai and Linking Road.

-By Shalini Seth