[INDIA REAL ESTATE NEWS] Good morning everyone I am Rumi Dhar from Kama Group.|
Here I have important INDIA real estate news to share with you which is as mention under.
Mall, multiplex operators, commercial property developers could take a revenue hit
Since the outbreak of the pandemic, the otherwise resilient office space market has been
witnessing a slowdown, with many companies allowing employees to work from home (WFH).
With extended closure of malls and movie theatres, retailers (in malls) and multiplex operators
(like PVR and Inox) are struggling with overhead costs such as electricity and maintenance,
on the back of no revenues.
Many have invoked the force majeure clause ― which prevents them from making payments
including rent to developers. But to provide relief to office space occupiers and retailers, many
retail property operators such as Prestige Estate Properties, Brigade Enterprises and Phoenix
Mills, have themselves started to waive rent for their tenants. According to reports, DLF, one
of the largest real estate developers in the country, has also waived minimum guaranteed
rent to its (mall) customers such as retail shops, movie theatres and restaurants up to June
15 and proposes to waive 50 per cent for Q2 and 25 per cent for Q3.
Impact on developers
While rent waiver could provide a breather for office space occupiers, multiplex operators and
other shops and restaurants, commercial property developers could take a hit on their
revenues. For instance, with waiver of minimum guaranteed rent by DLF, the company could
take a hit of ₹125 crore. According to the company’s management, about 17 per cent of the
company’s rental income is from retailers. In the recent March quarter of FY20, DLF’s revenue
fell 29 per cent and it reported a loss of ₹1,860 crore.
Read more at: https://www.thehindubusinessline.com/news/real-estate/covid-fallout-how-waiving-of-rent-impacts-developers/article31851362.ece
Have a nice day