With a major retail property explosion under way in India, Pioneer Property Zone, a joint venture between Old Mutual Property Group and Indian company ICS Infrastructure, has concluded two of the biggest retail leasing deals signed in the country.

Ian Watt, director of international operations for Old Mutual Property Group, says the leases cover a total of 50,000m? in two retail developments in Bangalore and Thane, which is an emerging middle- to lower-income area of Mumbai.

The shopping mall in Bangalore, which is being constructed by a private developer, is nearing completion.

Watt says the developer approached Pioneer Property Zone and asked the group for help in leasing the building. "They weren't sure about how to go about leasing. We?ve put together a concept that takes up the whole building."

The 35,000m? mall is fully leased. The project is expected to be completed by the end of the year with occupation set for the first quarter of next year.

The larger 65,000m? Thane development is being undertaken by Pioneer Property Zone, which is also putting together the leases and will be property managers for the asset.

The total space being let in the two developments covers 50,000m?.

This project is "more like our (Old Mutual Property Group) business in SA," says Watt.

The expected completion date is 2009, with groundbreaking for the Thane development expected in the first quarter of next year.

Watt says that through its joint venture, the Old Mutual Property Group is busy with a number of projects in India. Pioneer Property Zone was also retained by UK-based Liberty International as advisers.

Liberty International recently announced it was entering the Indian retail property market.

Watt says there is talk of 500 shopping malls being built in India over the next five years. "There is massive demand for retail," he says. A city such as Mumbai has 18-million inhabitants.

Kolkatti, formerly Calcutta, has a similar number of people living in its confines. "You have the population of SA sitting in two cities," says Watt. On one project the joint venture company is working on in Mumbai, there are 1,5-million people living within five minutes of the centre. About 30% of these people are "chauffeur-driven" and wealthy.

"Putting it into perspective, they (India) have had very little in the way of formal retail so India is catching up with the rest of the world. This is being driven by demand for space from the major retailers in India."

Business Day