RENT WAIVER: DLF Shopping MALLS MANAGEMENT SUGGESTS LOCKDOWN RENT WAIVER TILL JUNE 15, CONCESSIONS
DLF Shopping Malls have taken the first step after intense negotiations between malls and retail food outlets. DLF Shopping Malls has decided to resolve the impasse and offered to waive the minimum guaranteed (MG) rent for the lockdown period till June 15 while suggesting new rent and revenue-sharing slabs meant to expedite the reopening of eateries.
For the lockdown period till June 15, DLF recommended a complete waiver of rent for Cyber Hub tenants, a 70% waiver on MG rent in Q2, 45% in Q3, and 20% in Q4. Similarly, a 50% waiver on MG rent for Promenade Mall tenants in Q3, 25% waiver in Q3, and a 10% waiver in Q4. DLF has recommended this in a letter that is sent to retail tenants on the rental program while seeking to support them in restarting their businesses.
A company spokesperson said that DLF believes in long-term partnerships driven by strong relationships. This indication is in that same spirit.
The letter asks the outlets to reopen within seven days of the malls resuming business, a lock-in period till March 2021, and a 2% higher revenue sharing for FY 2020-21. The letter further adds that in case sales reach 80% of 2019-20 in Q3, then the MG rent would be 100% in Q4 at Promenade, while it would similarly be 90% in Cyber Hub if sales touched 70% of last year’s sales.
In order to avail of this scheme, the letter also insists on the clearance of all dues by September 30.
Restaurateurs are effuse at this proposal. Ashish Kapur of Whisky Samba and The Wine Company termed the developments as positive and a first formal communication by a mall developer showing a zeal to engage with outlets and restaurants. Kapur hoped for a quick reopening of restaurants.
AD Singh of the Olive Group of Restaurants explained the DLF terms were positive and progressive. AD Singh welcomed the suggestion of no rent till June 15, opining that this could have been extended till the pendency of the lockdown. Singh said it was fair that the rental would increase if the business was better, but said instead of MG rent, revenue sharing was a fairer way forward based on ground realities.
An Ambience group management official said that other mall developers are also discussing arrangements on a case-to-case basis. The Ambience Malls management explained that the majority of the brands had opened their outlets at their malls, and food outlets were following suit. They said their relations with retailers are harmonious. They are in constant touch with them and are actively working to resolve their problems.
Anurag Katriar, President, National Restaurant Association of India, said that most restaurateurs would request rent sharing as the best approach to the early reopening of restaurants as the MG rent was not feasible in such uncertain times.