Swastik Mall Analysis

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Swastik Mall Analysis

  1. 1. VIVA Group andSwastik MallAnalysis of Mall Operation, Finance, and Design
  2. 2. OrganizationIndian Real Estate MarketState of Indian Capital MarketsUndergraduate RecommendationsDescription of ProjectGraduate Recommendations
  3. 3. India GroupsIn Country Support GroupsGraduateJeffery BenaronJulia KaplanSteven MajichDaniel MillsEric AndersonKelsee CavasinoMatthew GibbonsNeha ShahMinh TrinhUndergraduateDakota SemlerBill WhiteThomas AuerBenjamin HeldmanMichael JoffeNicolas NenmiEdwin Wharton
  4. 4. Virar Relative to Mumbai•  60 Km from NarimanPoint•  Southern Mumbai•  Central Mumbai•  Thane, Vasai, and Virar•  Rail Transport•  Delhi Mumbai IndustrialCorridor60Km
  5. 5. Indian Real Estate Sector•  Zoning – Similar ZoningTypes•  Title – Recorded in LocalJurisdiction then Regional•  Title Insurance•  Permits – Local Buildingand Planning OfficesMCGM•  Bahujan Vikas Aaghadi•  Ownership Rights
  6. 6. Indian Capital Markets•  Illiquid Relative to U.S.and European Markets•  High Capital Costs•  Lower Transparency forInvestors•  Low FDI•  Risk Free Rate 7-9%•  FEMA Regulations•  Special Economic Zones
  7. 7. Virar Growth•  Past Decade shows 221% Growth in Virar-Vasai Region•  Rapid development in residential projects•  Slow growth in industrial, office, and retail developments•  Transportation corridor growth
  8. 8. Virar Growth•  Past Decade shows 221% Growth in Virar-Vasai Region•  Rapid development in residential projects•  Slow growth in industrial, office, and retail developments•  Transportation corridor growth
  9. 9. Virar Growth•  Past Decade shows 221% Growth in Virar-Vasai Region•  Rapid development in residential projects•  Slow growth in industrial, office, and retail developments•  Transportation corridor growth
  10. 10. Virar Growth•  Past Decade shows 221% Growth in Virar-Vasai Region•  Rapid development in residential projects•  Slow growth in industrial, office, and retail developments•  Transportation corridor growth
  11. 11. Virar Growth•  Past Decade shows 221% Growth in Virar-Vasai Region•  Rapid development in residential projects•  Slow growth in industrial, office, and retail developments•  Transportation corridor growth
  12. 12. Project Site•  400,000 Sq. Feet•  Located along Railway•  Between Nallasoparaand Vasai Rd. Stops•  3 Anchor Tenants•  Parking for 400 Vehiclesand 300 Motorcycles•  Indoor Design•  78 Small Retail Shops
  13. 13. Swastik Mall•  Shoppers Stop•  HyperMarket•  Indian Retails•  Local Retailers•  Customers primarilyfrom Virar-Vasai region•  Integra Mall•  Limited Competitors
  14. 14. Floorplans
  15. 15. Methods for Increasing ValueTo create added valuefor VIVA Group andInvestors by loweringoperating costs,increasing chargeablerents, and consequentlyincrease property value.
  16. 16. ISO 14000 and 14001•  Minimize impact onenvironment•  Comply with localregulations•  Continually improvestandards forenvironmentalmanagement•  Compensate forEnvironmental Impactof Processes
  17. 17. ISO 14000 and 14001 BenefitsOwner or Investor•  Reduced operating costs•  Higher rents and reducedvacancy rates•  Attracting and keeping tenants•  Resale value•  InsuranceTenants expectations•  Health and productivity•  Attracting and keepingemployees•  Reduced operating costs•  Environmental image
  18. 18. SanitationReasons for Implementation•  Greater livability andproperty valuesCollection and Treatment:•  Case Studies: Los Angelesand MilwaukeePrevention:•  Green Infrastructure:Greenways, PorousPavement and RainwaterCatchments
  19. 19. Waste DisposalWhy?•  Efficient and environmentallyfriendly waste disposal systemcan add significant value andaligns with goals of corporatesocial responsibility.Waste to Energy:•  Reinvesting waste products toreduce energy expensesDisposal Systems:•  Automated Waste Collection(the ENVAC System)
  20. 20. Location Planning•  Brick and MortarCompetition with E-Commerce Stores•  India lacks distributioninfrastructure, codingability across regionaldialects, and brandedgoods supply chain•  Competitive Analysis withRetail in Southern Mumbai•  Catchment Analysis
  21. 21. LEED Building Standards•  Third-party market-drivenprogram by the U.S. GreenBuilding Council providingverification for greenbuildings•  110-Point scale wherebuildings must score at least40 points in order to beconsidered “LEEDCertified”•  2 options of certificationprograms for retail properties•  Commercial Interiors•  New Construction and MajorRenovations
  22. 22. EffectivenessOperatingCostsBuildingValueROI Occupancy RentNewConstruction13.6%êé10.9%é9.9%é6.4%é6.1%ExistingBuildingProjects8.5%êé6.8%é2.5%é1%é19.2%
  23. 23. Costs to ImplementSoft Costs•  Application fees,Documenting,Energy Modeling,Commissioning,and Design &Engineering•  Additional1.5%-3.1% in softcosts<50,000Sq. Ft.50,000-500,000 Sq.Ft.>500,000Sq. Ft.USGBCMember$2,250$0.45 / Sq.Ft.$22,000Non USBGCMember$2,270$0.55 / Sq.Ft.$27,500ExpeditedFee$10,000 $10,000 $10,000
  24. 24. Attractions and Entertainment•  People come to the mallfor an event, service orexperience•  The mall becomes eitheran activity or adestination depending onthe attraction’s size•  People may not set out toshop, but they likely will•  Selling Experiencesversus products
  25. 25. BenefitsDuration of Stay•  4 hour average stay inentertainment mallsversus 60-90 minuteaverage stay in pre-entertainment mallIncreased Revenues•  7-8% increase in saleswith the addition of aCineplex•  Increased Rent RevenuePeople travel from further awayIncreased foot traffic•  Higher base rent
  26. 26. Categories of AttractionsDestination•  Waterpark, amusement park, ice rinkor small zoo•  Local Tourism Destination and DaytripsEvents•  Mini-golf/athletic facilities, art studioor Cineplex•  People will come for an afternoonand are willing to travelService•  Haircuts, restaurants, or dry cleaning•  More frequent visits
  27. 27. In Mumbai•  Cineplexs are common inmalls in Mumbai•  Restaurants are alsocommon•  Hypermarkets are popularanchor stores•  Services create marginalrevenue and marginal foottraffic from local residents•  Focus on adding indestination attractions tobring people in fromsurrounding areas as well astourists
  28. 28. Waterpark•  West Edmonton Mall•  Destination attractions havemade it a commercialpowerhouse•  Secondary Revenue Source•  Attract younger families•  Climate suitable forwaterparks•  Indoor to avoid monsoonissues•  Potential competition: TheGreat Escape
  29. 29. Amusement Park•  Mall of Asia in thePhilippines•  It is a touristattraction•  Growing in popularity•  Day trip activity•  Amusement parkindustry growing 25%annually•  Attracts families andyoung people•  Potential Competition:Yazoo Park
  30. 30. Grand IMAX•  L’Hemisferic in Valencia, Spain•  Designed by well regardedarchitects•  Tourist attraction within Ciutat deles Arts i les Ciències•  Between “Destination” and“Event” category•  Popularity of Bollywood•  IMAX’s have been rapidly growingin popularity in emerging markets•  Imax experiencing 20% growthrate•  Sustained interested for a risingmiddle class•  Potential competition: Manyother cineplex’s and a fewIMAX’s
  31. 31. Architecture and Experience• Architectural Tourism• Experiential Design• Construct User Experience• Development of Regional RetailPlan
  32. 32. Overview•  Utility Stability•  Surrounding Sanitation•  Improve Catchment•  Develop Regional Attraction•  Architecture and ExperienceDesign•  Perception of Virar•  Improve Investor Position of VIVAGroup

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