Jaipur: Malls waive off rent for shops during lockdown period

JAIPUR: Malls in Jaipur have yielded to the demand of the shop owners and waived off rents for the whole lockdown period while footfalls remained below 20% of the pre-Covid times.

Many of the malls have also reduced rentals by up to 50% for the next six months keeping in view the reduced demand and lower footfalls. Many shop owners have opted for a revenue sharing model where the rent would be linked to the actual business.

But food courts in most of the malls still remain closed and the owners are reluctant to renegotiate the terms and conditions as that will compel them to reopen at a time when people are reluctant to dine outside during the pandemic.

“There is no point in renegotiating the terms with mall owners when we cannot open the food joints. That’s why we are not going to meet the mall owners even if they are calling us. They know that they would not find any new clients in this current scenario and that’s why they are keen to see us reopening. But, now there is no business case for reopening,” said the owner of a food court.

In fact, footfalls in the malls are not increasing as expected even though people are now more open to come out on the roads. There is a clear contrast between the traffic on the roads and the deserted malls.

“People are still reluctant to enter the closed environs fearing infections even though malls have put in place elaborate systems for maintaining hygiene and other SOPs,” said a mall owner.

“In a week’s time, the summer off-season sales will start. We are expecting good crowds during that time. That is also likely to boost confidence of people,” said Anil Yadav, general manager of MGF Metropolitan mall.

After the state government allowed the malls to reopen from June 8, all of them opened. But only 40% of the shops have reopened for business because of various reasons.

“First, there is no demand as of now due to lower footfalls. Secondly, some shops are still renegotiating the contracts. It will take a while before most of the shops reopen,” said another shop owner in a prominent mall.

Shops which paid rents earlier are now looking to strike revenue sharing deals as they are not sure of demand. The revenue sharing model varies from one business to another and the rates accordingly.

“It is easier to strike revenue sharing deals with where the builder is the mall owner, who can easily track the sales daily. But the case is different when the outlet is owned by an investor, who could be anywhere in the world. The investor does not have the wherewithal to track sales and get the revenue share. That is one of the problems why some shops have remained closed till now,” said a mall owner.

Many said the mall owners have been very cooperative in these times of extraordinary crisis and may be they also know there is no alternative except to facilitate the shop owners as there would almost be no new tenants.