Chennai Metro Rail Ltd., (CMRL) a JV between the Union Govt. of India and the State Govt. of Tamil Nadu announced a Retail and Commercial Tender to unlock over 2,79,334 sft by developing the available empty spaces acorss the stations and it’s neighbouring areas for Retail, Food counters, Restaurants, Lounges, Offices and for other commercial purposes. This could be the largest ever single tender to lease such a large expanse of areas spread over 31 Metro Rail Stations which span over 54.1 kms across the city and includes Corridor 1 & 2 .
From a peak capacity of 1 lakh passengers per day in the pre-covid era, daily traffic fell down to Zero during the lockdown last year. From Sep. ‘21 onwards, foot traffic users of Chennai Metro Rail increased and reached 70% of pre-covid daily numbers but was once again reduced to Zero after the complete lockdown that began in May ‘21. Currently, around 30,000 passengers travel daily across both corridors and most of them include government employees, as only they are allowed liberal travel using public transportation currently. But this is expected to improve with the TN Government allowing further relaxations from 27 Jun. ‘21 onwards.
Travel Retail at Metro Rail locations have been extremely popular worldwide though the South East Asian countries such as Thailand, Malaysia have taken a big business opportunity of it and of course Singapore has created a fantastic business model which is couped with multi-modal hubs (airport / bus stations) etc. as well as connecting or making the Metro pass through commercial hubs and shopping areas as well as connecting neighbourhood areas for a seamless travel on work and leisure. In fact, in many countries, Metro Rail is a tourist’s first discovery and the local administration urges foreigners especially to explore the city using their Metro. In India, Delhi Metro, which has been in existence for over 20 years has made limited use of the available commercial opportunities but for leasing large chunks of land for commercial development such as a Mall or Parking lots.
Chennai Metro has not yet gained expected patronage for multiple reasons. For one, the last mile connectivity – that is from the Metro station to the destination of users is still a tall ask. One has to still depend on the local autorickshaws or Buses which loses the plot of travelling by Metro Rail over all. Secondly, the corridors are yet to connect crowded neighborhood areas and instead travel via some of the arterial roads of the city where public transportation options such as suburban trains and buses is already adequate. Add to that, Chennai city has among the most number of 2W and 4W in the country and ranks among the top 5 Indian cities. So, there are fewer compelling reasons to take the Metro. Lastly, the ticket pricing (compared to local trains and buses) have been less competitive which is a big deterrent.
That said, CMRL is leaving no stone unturned and has been doing a fantastic work attracting people of all age groups and all segments to take the Metro. Over time, there is little doubt that the commercial opportunities will reap rich benefits to Retailers. It’s not a long wait but potential businesses need patience.
