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The anchors that first pull the crowds here - and at other malls all over the country - are as varied as they come. There are the US and European chains such as McDonald's, Lacoste, Pizza Hut, Benetton, Subway, Marks & Spencer and Mango.
Their success has spawned the emergence of successful Indian chains such as Pantaloon, Globus, Shoppers' Stop, Giant, Lifestyle and Big Bazaar. Stores named after popular branded merchandise also act as effective anchors. These include the likes of Tommy Hilfiger, Swatch, Arrow, Louis Vuitton and Nike.

Foreign mall operators cannot enter India as foreign companies are not allowed to own real estate in India. Companies like Nike, McDonald's and Reebok sell at mall outlets through their Indian subsidiaries or franchisees. McDonald's, for example, has appointed two master franchisees in India, and these in turn have appointed numerous sub-franchisees all over the country. A sub-franchisee, therefore, could open a McDonald's outlet either as a stand-alone store or as one of the many stores in a mall.

Making the job easier for the anchors is a gradual change in the Indian economy from a socialistic to a capitalistic one. This has led to a rise in the numbers of middle-class consumers, their wallets stuffed with more disposable income. According to one estimate, over the past three years, consumer spending has increased at a respectable rate of 12% per annum.

Another reason for the ongoing boom in mall activity is the opportunity to retailers for a greater accessibility to real estate at affordable prices. Part of this is due to easier availability of bank and institutional finance. And in places such as Mumbai, the freeing up of much-needed real estate. This has happened with the many closed textile mills in the central part of the city now being allowed to exploit their real estate for other commercial purposes. Investors are attracted by the 14% returns in the malls business, compared to 11% in the office segment and 6% in the residential segment.

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* Contributed by: -
Deepak Verma (Campus Associate),
PGD-GMT from National Institute of Fashion Technology,
Currently persuing PGDBM from Welingakr Institute of Management, Mumbai.