With Shoppers Stop pulling out of talks with the owners of Atria Mall after two years of active negotiation, the fate of the country’s first luxury mall is once again in a limbo.
The retail major was in discussions to sign a rental agreement to occupy two floors (35,000 sq ft) of the mall, which is located in the upmarket area of Worli, Mumbai. “We are not in talks to move into Atria at the moment,” Govind Shrikhande, MD and CEO of Shoppers Stop, told FE. JLL India, the real estate consulting firm that was brokering the deal, also confirmed the development.
Atria, which opened doors amidst much hype in 2006, hinged heavily on the Shoppers Stop deal as it is now 80% empty. “If the mall could rope in Shoppers Stop as anchor tenant, it would have lured other reputed brands to also open stores because of Atria’s excellent location,” said Sanjay Dutt, executive managing director (south Asia), Cushman and Wakefield.
As per JLL India, disagreement among Atria’s multiple owners pulled the plug on the Shoppers Stop deal. “The transaction was contingent to certain conditions that were not met in a timely manner,” said Pankaj Renjhen, managing director of retail at JLL India. The mall has three main owners — Champalal Vardhan, Dalichand Shah and Bhupesh Jain. Additionally, a number of stores were sold to individual brands. Sources say Shoppers Stop required certain structural changes, but the promoters could not evict occupants from the area that required redesigning, especially because these brands own their shops. Negotiations also depended on whether Atria could sign on a few players to comprise the entertainment zone, which is a prerequisite in any mall, they added.
FE sent an email to Champalal Vardhan, but did not get a response.
The ground level of the mall that once hosted marquee global retail majors such as Mango, Promod, Rolls Royce, Tissot, Aldo and Ducati, now has just a handful shops open; majority of them are little-known local players like Gorgeous Boutique, Kashmir Art Bazaar, Doorbell Pharmacy and Simples Boutique. The third and fourth (food court) floors are deserted, with just two to four stores open on each floor. “We don’t get new clients anymore although some of our existing customers continue to drop in,” said a store representative of a local cosmetic brand, located on the third floor, on condition of anonymity. A Cafe Coffee Day outlet and ‘Cheez n Chill’ are the only eateries that are still operational in the food court, where the air-conditioning is grossly inadequate. “Mall management and footfalls are the most startling fallout of such high vacancy,” said Dutt.
Austria-based jewellery brand Swarovski and Canadian fashion retailer La Senza are the only popular foreign brands that are still operational on the ground floor of the mall. La Senza, however, confirmed to FE that it is in the process of relocation. Swarovski said since the brand owns its store in the mall, it is not moving. Sepia, a clothing brand, and Cheeze n Chill, located on the top floors of the mall, are also facing the same issue. “The stores that were once sold to brands to generate cash flow should ideally be bought back by the promoters, because having multiple stakeholders makes implementing a new plan complicated. But that needs capital infusion by the promoters.” said Renjhen. The design also needs a change, as several ground floor stores are in hidden alleys, hampering visibility, Renjhen added.
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