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The Great Indian Mall: Evolution In Process

Published by indiaproperty November 9th, 2010 in Newsbytes.

With the provision of more entertainment options in malls, Indian retailers now have vastly
enhanced their ability to increase sales. Until recently, street markets and bazaars were the top
performers in the retail space, and they were cornering a huge chunk of the overall sales.
However, traditional markets now have to imitate malls by creating a better overall shopping
experience for potential customers.

They have to offer a larger mix of diverse products – including food and beverage as well as
entertainment outlets, preferably under one roof, like malls do. A consumer is attracted to a mall
because of the availability of world-class services, exposure to various brands, tempting
promotional offers and periodic discounts. The superior ease of shopping in air-conditioned,
aesthetic comfort as well as access to a variety of food options are added incentives to mall
visitors.

New Business Strategies

Rising competition has made mall developers focus on core competencies and accurately
researched offerings to their target customers. To begin with, they attempt to understand the
shopping needs of customers in their focus ‘catchment’ areas. Then, they proceed to build a well-
planned portfolio of retail options that address the needs of those consumers. Post-recession,
retailers have become a lot more vigilant in terms of expansion, and they now evaluate the
specific dynamics and profitability of each location more carefully than ever before.

Certain business strategies have now been recognized as absolutely necessary for running a mall
successfully:

Zoning: Formulating the right tenant mix and its placement within the mall is important. The
bouquet of different retail stores occupying space in a mall is called the tenant mix. Zoning is the
process of dividing the available mall space into different sectors for placing various retailers.

A sustainable revenue model: Mall developers should not only concentrate on fixed rental but
develop innovative models where both retailers and developers would be able to earn profits.
Working out a pure revenue sharing model with a minimum guarantee is one of the most
favorable practices at present.

Promotions and marketing: Events that can help promote companies are essential. These fall
under the purview of effective mall management – more on this below). Some of these events
include food festivals and celebrity visits that increase foot falls and in turn sales volumes.
Organizing cultural events has also proved useful. The savvier mall developers now plan out
marketing strategies for individual malls in order to meet the requirements of local consumers,
and to address the challenges of local or regional competitors.

Mall Management

Mall management – a function of Property & Asset Management – is basically a combination of

services that factor in people, place, processes and technology in a particular building.
Professional mall management results in the best possible utilisation of resources available. It
encompasses three aspects – infrastructure, ambience and traffic management:

Infrastructure management – This pertains to the management of facilities provided to tenants, as

well as risk management measures such as adopting essential safety measures, conducting asset
liability and environmental audits and imparting emergency and evacuation training.

Ambiance management – This refers to the management of the mall’s overall appearance and
‘feel’, which is necessary in every mall.

Traffic management – This concerns itself with crowd management, both inside the mall
premises and in the parking zone.

The Road Ahead

Until very recently, most Indian mall developers considered mall management as another name
for facility management. The realisation that these two concepts are different and that
professional mall management has immense bearing on the long-term viability and success of a
mall is gradually being accepted. It is gratifying to note that more and more mall developers are
now adopting professional mall management in order to attain and maintain success.

Source :Col. Ashutosh Beri (MRICS), Managing Director – Property & Asset Management,
Jones Lang LaSalle India

what would Victor Gruen SAY?

May 1, 2003 12:00 PM, By John Kriskiewicz

A half-century ago, architect Victor Gruen introduced America to the enclosed shopping mall.
Before Gruen, there were two types of major shopping environments in the United States: the
traditional downtowns, and the improvised shopping strips that lined highways of metropolitan
areas. And although today's lifestyle centers and other Main Street-inspired developments don't
look anything like Gruen's creations, they don't necessarily break from Gruen's way of looking at
the world.

Born in Vienna, Gruen worked there until 1938, when the Nazi takeover of Austria forced him to
flee to the United States. What he brought with him was a belief that architects must solve
environmental and urban problems in addition to designing individual structures. In 1949, he
established Victor Gruen Associates to do just that.

Throughout the 1950s, Gruen spelled out his philosophy: As people left the cities for the suburbs
of postwar America, what they missed was a central place for shopping, walking, meeting
neighbors or just spending time. Highway strip malls were uninspired, dangerous and single-use.
In designing the automobile-based environment, then, architects should restore some of the
satisfactions of the old pedestrian city, with new climate control technologies, within the safe
walls of a mall.

“The shopping center is one of the few new building types created in our times,” Gruen observed
in his 1964 book, The Heart of Our Cities. Gruen recognized that a mall could solve the
problems of both retailers and of planners by moving the shopping environment away from the
highway and forming an integral part of a new residential community. He credited Kansas City's
Country Club Plaza with pioneering this new way of shopping.

No mere theorist, Victor Gruen Associates — among the postwar period's premier national
architectural, planning and engineering firms — designed one of the first regional shopping
centers, the Northland Shopping Center in Detroit, in 1954. It also conceived the first enclosed
mall, Southdale Shopping Center near Minneapolis in 1956, and planned the first enclosed mall
built in a central business district, Midtown Plaza in Rochester, N.Y., which opened in 1962.

Gruen succeeded at reconciling the needs of the auto-oriented suburban boom while creating a
satisfying pedestrian friendly environment — if not in suburban communities, at least within the
mall. His designs for shopping centers were profitable for their developers and focal points in
their communities. While his ‘Mid-Century Modern’ designs looked to the future, he was
providing “the needed place and opportunity for participation in modern community life that…
American town squares provided in the past.”

Gruen also sought a balance between the architectural rigor of Modernism and the pragmatic
realities of a competitive retail environment. Comparing it to the balance between federal and
state governments, he wrote, “The overall character of the center must be one of corporate
strength through the strength of individuals.”

The statement is more prescient than perhaps Gruen imagined. On the other hand, his view of the
future from the mid-20th century was not flawless. In 1960, for example, he concluded that if the
postwar economic boom and technological innovation were projected forward, Americans would
soon create an affluent society with plenty of leisure time. Clearly, America remains affluent, but
it has not delivered the leisure in abundance that Gruen and other futurists predicted. His
prediction that all shopping would be done in “planned, coordinated shopping centers” has not
come true.

But Gruen's view of how the shopping center might eventually morph into something like a
communal space seems to be becoming reality. He predicted that the intermediate and
neighborhood shopping center would evolve, with commercial, social and leisure time facilities,
protected green space, as well as a variety of residential uses to offer — like the town square, and
today's lifestyle and mixed-use developments. Although these spaces are more privatized and
aesthetically nostalgic than he would have approved, it all seems to have happened, and it all
traces back to him.

John Kriskiewicz is a professor at the Parsons School of Design and Manhattan College, and a
freelance curator.