Twenty-four-year-old Sanya Runwal, director – Retail, Runwal, speaks about the guiding principles behind the group’s retail transformation, future developments and her vision for brand Runwal as the next generation leader
When travelling on the Eastern Express Highway in Mumbai it’s hard to miss the gigantic hoardings by Runwal, Mumbai Metropolitan Region’s leading real estate player enticing people to book a home at many of its upcoming projects. As you near Mumbai’s suburb of Ghatkopar, the narrative changes to one enticing inviting you to step into the group’s massive 1.2 million sq. ft. Mall R City, launched in 2009.
The 1978-established realty group is one of the early entrants in the shopping centre business with a mall launched in the early 2000s. Today, it has the most number of malls by any real estate player in Mumbai, strewn across the maximum city’s central suburbs. Its mall portfolio includes R Mall, Mulund (2.5 lakh sq. ft.); R City, Ghatkopar (1.2 million sq. ft.), R Mall, Thane (2.5 lakh sq. ft.) and R Odeon in Ghatkopar (1 lakh sq. ft.).
While retail was always important to Runwal, the group has now cranked up its attention on the division, especially with its third generation entering the family business.
In May, the developer bought out the 50% stake of its partner Government of Singapore Investment Corporation (GIC) held in R City mall for Rs 1,000 crore. While GIC went smiling to the bank with over fourfold returns on its investment made some 17 years ago, Runwal acquired full ownership of the prime asset. The deal is touted as being one of the biggest purchases of a single property in the Indian retail sector.
Since COVID-19, the group, which has a retail spread of 1.8 million sq. ft. has been sharpening its focus on retail, revamping properties, refining customer experience and chalking out plans for new projects.
In an exclusive interview, Gen Z executive Sanya Runwal, director – retail, Runwal, speaks about the guiding principles behind the group’s retail transformation, future developments and her vision for brand Runwal as the next generation leader. Edited excerpts…
You’ve grown up with the business. How have you seen Runwal mature in retail?
Over the years, the size of the malls has grown as we have learned the retail business－managing malls and understanding what customers are expecting.
We now want to take our expertise and experience from malls and make that a core part of our upcoming mixed-use developments in the form of high-street retail. We want to focus on retail and the experience we offer.
Is that why you are revamping your malls, including R Mall, Mulund?
Yes. R Mall Mulund is very special. When it started it was a learning curve for us as a group. Now we are rethinking it to make sure it stays relevant and up to the standards of where we are today in comparison with the rest of the malls in the portfolio and also for the community around. So it is like an uplift, including a new look with a much more digital and modern facade. However, the revamp is happening in phases, the first covering the external look and feel. Other phases will include internal changes, leasing, circulation and more.
R Mall Thane too has undergone a significant facelift…
My Dada started his career from Thane. It is where he purchased his first plot of land. The response and the love he got from there have always stayed close to him.
He wanted to have a mall in Thane. And when we started there, it grew as we grew.
It was always meant to be a neighbourhood mall and started off along the lines of R Odeon. But now, we want it to be a community centre and lifestyle space as opposed to just a place to shop. So, we are bringing an Inox, adding a food court and providing more family-centric entertainment.
When did you feel the need to change?
Before COVID-19. But the pandemic provided an accelerated push. We noticed that consumers are changing in the way they interact with the mall itself. A city like Mumbai does not offer many places to spend time with family, like parks. You do not have many entertainment options here.
We realised that people have started looking at malls as an option to spend an entire day with their families doing multiple things in an airconditioned environment. With COVID-19 there was a chance and an opportunity to think about our strategy, and renew these spaces because we were seeing the trend happen.
And we slowly started renovating our malls, including R City.
What is the guiding strategy behind the transformation of these properties?
The guiding philosophy is our malls should reflect the customer of today in terms of the brand mix. Consumer tastes are always changing. Their needs change with each generation. What brands are popular, relevant is always dynamic.
So, the brand mix should always be up-to-date, should always be relevant, and always be competitive. If that is not happening, then you are not going to get a newer audience or even retain the customers you have already built a relationship with. That is why we are constantly evaluating whether our brand mix makes sense.
Also, with e-commerce coming into the picture, everybody is used to convenience. The more effort you have to take to find anything, the less likely you are to do it. At R City, which is a 1.2 million sq. ft. mall, if I have to go from one end to the other end to find the same thing, I will never make that journey. That’s why we are also working on improving our zoning with a focus on creating pockets within the mall such that if you have a specific need, you go to the pocket that fulfils it. That pocket will have every choice within the category.
So we are working on a tight zoning strategy to facilitate that convenience, that e-commerce-like ease. We are trying to make it really sharp so that our customer has the easiest navigation and as intuitive shopping as possible.
These are the overall guiding principles although each of our malls caters to a different niche and catchment. At R City we are trying to up the lifestyle premium luxury quotient and we physically renovated the space during COVID-19. Whereas R Mall is a neighbourhood mall and we are trying to position it like a community hub.
Are you also targeting a different set of customers, especially for R City?
The beautiful part about R City is that we have a land parcel that is so big to create a mall that can appeal to everybody- from toddlers to senior citizens. It has a Kidzania and stalwarts like Suresh Wadhkar performing there.
Having said that, we are also very conscious about having brands that appeal to a younger generation. We always have been looking to pioneer brands within a space and giving them an opportunity. For instance, we have a lab-grown diamond brand coming into the mall for the first time. So, we are not afraid of brands the youth is connecting with and which are doing well outside. We do a lot of listening through consumer research and surveys and try to make what people are aspiring for, happen.
So will you be bringing in e-commerce or omnichannel in any way to keep up with other malls in the city?
Integration of omnichannel will eventually happen through our partner brands. But I do not think we want to be an e-mall or a place where you just come to pick up stuff booked online. We want people to come to explore the options, and the variety and experience them all.
Are you planning any technology or digital integrations?
We have been working on the operations side to improve ease of navigation in the malls with digital directories and smart parking. We are working with our retail partners to better facilitate their omnichannel operations by mapping more delivery pin codes to our website and providing easier parking access to their delivery vehicles among other things. We have redone our website, making sure it is up-to-date, modern and relevant. We are making sure the back end is solid with no foundational gaps anywhere.
In addition, we have taken a lot of our back-end paperwork online. These small things make a big difference when it comes to improving efficiency and processes.
So, we are taking baby steps to become technologically enabled.
How has your retail business been doing, financially?
We have been growing steadily and were able to recently purchase back all of GIC’s stake in R City and they exited with four times the return on their investment, which is a good sign.
What can you tell me about your upcoming property in Pune?
Only that we are coming up with a greenfield project in Pune and are exploring more land parcels for retail and you’ll see something from Runwal within the next five years. We have one residential property there but there is nothing concrete as of now to share.
What is your current leasing model and what is your churn rate?
We do a mix of minimum guarantee and revenue share, but it really depends on how the deal is structured with a specific brand.
And the churn depends on a case-to-case basis, every quarter, we evaluate the brands, their performance and the leases nearing expiry. We evaluate a brand’s, performance track record and its relevance in the future. And based on certain parameters, we take a call on renewal.
What learnings from your existing malls are you applying in your upcoming retail projects?
Experience trumps all. If customers do not have a good experience at a mall, regardless of what they have purchased or done, they will not come back. Malls are not a one-ticket purchase like residential.
Here, you want a customer to come back frequently and often. Then, novelty is important and a big driver. What newness can you bring? What additional value can you add? Because we’re humans, we get bored quickly. So going forward, these two things－experience and novelty－will be the pillars of our retail projects.
Speaking of future projects, tell us more about the high streets you are planning.
We are trying to focus on high-street retail in our mixed-use developments. We want to build high streets that feel premium and provide a space to interact with the community in a different way than a mall. A mall offers a closed environment. High street retail is half in and half out. Take for instance high streets in Bandra, they have a different environment. So, how can we upscale that a bit? You know, base it on the al fresco concept that has been very popular.
The brand mix will be dependent on the catchment.
You are Gen Z. How is that going to reflect in the malls or in the way you lead the business?
When you grow up in a family business, it is always a part of you, even though you are seeing it from the outside through your formative years. I have been there for the Pooja when some of the malls were just a piece of land. Now, after joining the business for the first time, being a part of it, seeing how it functions, seeing how everybody else functions, the vision Dada had to what Papa had, now I am able to bring my thoughts to the table… And I want to really establish our retail business.
Also, in a way, we are very quiet about what we do. If you know us, you know us. If you do not, we are not going to come there and shout and tell you who we are. But there is value in it. However, people value the brand as much as they value the product and a brand halo can have a powerful effect.
What I hope to do is tell the story better, tell it louder, in a cohesive way. I want to build an emotional connect and get people, and retailers to associate with not just one mall, but the Runwal brand. At a corporate level, what we stand for is something I am passionate about.
Which malls, apart from your own, do you admire?
Dubai Mall has impressed me since I was very young. As a kid, it seemed crazy to me what all the mall had to offer. I was skiing in the middle of Dubai!
What they have managed to do with that mall and provide, in terms of operational excellence and the brand mix and the amenities they offer, is beacon…top class!
The other is Hudson Yards in Manhattan. When I first went to New York, that area was barren. And by the time I left, it was a thriving tourist hub.
So what inspiration are you bringing?
Experience. People just came there to experience it. The shopping was secondary, but they created a story around it. They had a lot of novelty, like sculptures, art like the Vessel, which was the centrepiece and it became very famous, all through their own marketing. They would conduct a lot of DJ sessions. It was not loud, but everybody knew about it.
I think that is a skill to have. It was a lot of word of mouth and they built it from scratch. Hudson Yards is a prime example of experience and novelty driving something amazing.
