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The southern shopping spree

R Srinivasan

Andhra Pradesh Chief Minister Nara Chandrababu Naidu once dreamt of holding a shopping festival in Hyderabad that would rival the biggest and the best in Asia. That dream never got to the cash counter.

But Hyderabad is about to become a shopper's paradise of a different sort. It will soon have more world-class shopping complexes than any other city in India.

These aren't down-at-heel shopping malls that will quickly degenerate into urban slums. The giant new malls that are taking shape are glass-and-concrete temples to the cult of shopping.

Take the G S Group, which is spending Rs 200 crore (Rs 2 billion) on two state-of-the-art malls equipped with escalators and with space for giant parking lots. The group has hired top Mumbai architect Hafiz Contractor to create the two futuristic complexes.

"It is only a matter of time before the elite of Singapore and Dubai become envious of the projects that are coming up in Hyderabad and Secunderabad," says Gowrishankar Gupta, chairman and managing director, G S Group.

Gupta isn't the only one putting down the foundations for ambitious complexes that will serve the movie-going public and shoppers.

The L V Prasad Group, which has been a key player in the south Indian film industry for over 50 years, is spending over Rs 60 crore (Rs 600 million) to start the first IMAX theatre in south India. There'll also be a five-screen multiplex and 200,000 sq ft reserved for a shopping arcade and food court.

The Prasad Group's ambitious venture is taking shape on the shores of Hussainsagar lake where the government has released a 2-acre plot of land on a 33-year lease. It is scheduled to become operational in January 2003.

"We have planned the complex on the lines of similar facilities available in the west, particularly in the US," says A Ramesh, managing director, Prasad Media Corporation, a subsidiary floated to get the project moving.

Each of these malls is putting in new, distinctive features that sets them apart from existing Indian shopping complexes.

Take the Sanali Mall coming up on Abid Road, which was once a fashionable shopping area during the Nizam's rule. The mall is being put up by Remax Constructions and will have a huge parking area at two different levels. Cars will be moved from the street level by a giant-sized lift.

Or look at the G S Group's G S 24 Carat, which will have a built-up space of 250,000 sq ft that will include a shopping area of 200,000 sq ft spread out over four floors. Another 50,000 sq ft will be an entertainment complex with four multiplexes, a multi-cuisine food court, entertainment centre, restaurants and a conference facility.

Similarly, the G S Group's second complex - G S Centre point - which is in the up-and-coming Panjagutta area, will be a seven-floor shopping and commercial complex with 100,000 sq ft of covered parking space for 1,000 vehicles.

It will have shopping complex spread over 160,000 sq ft and office accommodation spread out over 90,000 sq ft.

The G S Group has been in the construction business for over 50 years and Gupta knows the pitfalls faced by commercial complexes that have come up in the city, but which have no takers.

"What is lacking is the parking space as per international standards. In each one of the complexes I am planning, provision has been made for parking 400 cars and 500 two-wheelers at two levels over an area of 80,000 square feet," he says.

Besides, the group has hired property consultant Richard Ellis to market the space. About 40 per cent will be sold outright and the remaining 60 per cent will be given on lease.

Is there enough demand for so many new projects and will they generate healthy returns? Everyone is betting big money on them including the financial institutions.

A consortium of institutions, led by IDBI, has committed Rs 35 crore (Rs 350 million) - Rs 30 crore (Rs 300 million) as term loan and Rs 5 crore (Rs 50 million) towards equity - for the project being put up by the L V Prasad Group. The remaining money will come from Prasad Group's internal resources and from associates.

Why is such a boom taking place in Hyderabad? A recent study has shown that Hyderabad is one of India's fastest growing cities.

What's more, it is a city where the costs of operations are still relatively low. In terms of the cost and quality of the infrastructure, Hyderabad is now moving ahead of many other Indian cities.

Take the National Vacancy and Availability Index compiled every quarter by C B Richard Ellis, which shows how much cheaper Hyderabad is than other Indian cities.

For example, while in micromarkets like Nariman Point, Ballard Estate, Worli and Bandra in Mumbai, the total occupation cost (rent in rupees sq ft per month) ranges between Rs 325 (Nariman Point) and Rs 238.80 (Bandra), and in the case of Connaught Place, south Delhi and Gurgaon it ranges between Rs 162.50 and Rs 71.70, for Hyderabad it is a mere Rs 25.60 against Bangalore's Rs 105.79 and Chennai's Rs 86.30.

Hyderabad is also turning into a more cosmopolitan city that is attracting outsiders. Of its 6.3 million population, 21 per cent have come from other states.

The years 1995-2000 saw a tremendous growth in the inflow of migrants because of the enormous opportunities created by the state in the information technology area.

About a year ago Chandrababu Naidu dreamt of holding a shopping festival that would rival the Dubai Shopping Festival, the Great Singapore Sale and the Malaysian Festival.

The Great Mall of Hyderabad was to be organised by Ogilvy Live, a division of Ogilvy & Mather Advertising, with cooperation from the state's tourism department in October.

But the events of September 11 dealt a death blow to the event. Now, Naidu's dream is coming true but in a very different way from what he had envisaged.

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