Rental income of 23 shopping malls might decline 24 per cent to around Rs 300 crore during the January-March 2021 period as compared with the previous quarter due to the COVID-19 pandemic, according to rating agency ICRA.
The estimate is based on the sample of 23 malls, covering 14.2 million square feet, across nine states, it said. The rating agency pointed out that footfalls and businesses in malls have declined this month due to the restrictions imposed by various state governments to curb the spread of the Omicron variant of corona virus. When contacted, ICRA Sector Head (Corporate Ratings) Anupama Reddy said the rental collection of these 23 malls could drop by 24 per cent from an estimated Rs 400 crore in the previous quarter.” The pre-COVID-19 peak rental income for ICRA’s sample (23 malls) was at around Rs 470 crore in Q3, of FY20,” she said.
She pointed out that the rental income of these 23 malls fell to Rs 85 crore in the first quarter of the financial year 2020-21 due to the nationwide lockdown during the first wave of the COVID-19 pandemic. With the easing of restrictions along with a decline in the fresh infections, she said there was a gradual improvement in the rental recovery in the third and fourth quarters of FY2021.
Rentals income stood at around Rs 355 crore (82 per cent of pre-COVID-19 rentals) in the fourth quarter of the financial year 2020-21. However, on account of the Covid second wave in April and May of 2021, the shopping malls had to be closed down again. As a result, the rental of the malls in the first quarter of 2022 was down by 62 per cent and stood at Rs 135 crore, she said.
