Mall Owners To Moviemakers Brace For Coronavirus Hit
As states announce measures to counter the coronavirus outbreak, malls, retailers, multiplexes and filmmakers could see business slow down, at least in the short-term.
Maharashtra, Karnataka, Delhi, Kerala, Jammu & Kashmir and Tamil Nadu have ordered a shut down of non-essential stores in malls along with cinemas until the end of this month as the number of confirmed Covid-19 cases in India mounted. That means lifestyle and electronics retailers and multiplexes will remain closed in some of the large cities like Mumbai, Delhi, Bengaluru, and Chennai.
“Even before the government ordered the closure of malls in some of the key cities, footfalls had already gone down by 50 percent due to the anxiety surrounding the virus,” according to Rohan Sharma, head-research at real estate consultant Cushman and Wakefield. It’s too early to gauge the impact but there will definitely be financial implications of low footfalls and subsequent closure of malls if the situation continues, he said.
Channel checks found 5-15 percent drop in footfalls at certain malls in key metros, and this could worsen in the coming days, Latika Chopra, an analyst at JPMorgan, said in a report. Department stores and apparel retailers would also be impacted and if the situation worsens, there could be a risk of higher discounting to clear the inventory, she wrote.
That comes when Indians cut down consumption in a slowing economy expected to grow at its worst pace in more than a decade in fiscal ending March. Deserted malls and shuttered stores will only drag growth lower.
Impact On India’s Largest Mall Owner
India’s top eight cities — Mumbai, Pune, Bengaluru, Chennai, Delhi-NCR, Hyderabad, Ahmedabad, and Kolkata) have 126 malls—61 million square feet of space with more than 100 malls having multiplexes.