The Lockdown period brought with it a tussle over rentals between malls and retailers. Therefore, this tussle, has now pit a private equity giant and a retail giant against each other.
Reliance Brands Ltd and Reliance Retail have together served termination notices. These notices indicate the end of leases of dozens of outlets in 9 Blackstone-owned Nexus Malls.
Reliance Retail made repeated appeals for postponements on rents for the lockdown period by invoking force majeure. However, Nexus replied by stating that the clause was not applicable as per the lease agreements. Further, Nexus reiterated their stand stating that they will adjust rents with security deposits, for the months in question. In addition, more failed negotiations and discussions took place between the parties. After failure to reach middle-grounds, Reliance Retail sent out termination notices.
Nexus is one of the country’s largest mall operators with 9 shopping centres in Mumbai, Chandigarh and Pune, among others. Over the past 4 years, Blackstone has aggressively acquired malls as a means to push into India’s retail real estate.
Sources say that this move may impact outlets in Nexus malls including Reliance Digital, Reliance Treands, Hamleys, Michael Kors and Steve Madden, among others.