New Delhi, January 25
The top 7 Indian cities are set to see the addition of nearly 9 million sq ft of new retail space in 2025, with gross leasing volume expected to surpass 2023's 8.7 million sq ft, according to the commercial real estate and investment management company, JLL India.
Despite continued interest from international retailers, domestic retailers dominated the gross leasing with more than 80 per cent share, leasing approximately 6.5 million sq ft in 2024, the report said.
The top seven cities are Mumbai, Delhi NCR, Bengaluru, Kolkata, Chennai, Pune, and Hyderabad, as per the report.
The report added that the gross leasing volume in 2025 will surpass the 2023 levels of 8.7 million sq ft easily on the back of continued interest from international brands coupled with healthy space taken up by domestic retailers.
The retailers, in 2024, leased 8.1 million square feet of space in shopping centres and well-known thoroughfares in India's top seven cities in 2024, JLL India said in the report.
Retailers continued to grow their footprint across retail formats throughout the year, and gross leasing only moderated by 6 per cent over 2023, as the retail sector maintained its momentum despite the restricted inflow of new spaces of exceptional quality, as per the report.
Bengaluru accounted for 34 per cent share of the total leasing activity, followed by Delhi NCR (14 per cent), and Mumbai (14 per cent). The concentration of 62 per cent of total retail space take-up in these three Indian megalopolises underscores the strong consumption demand in prime retail centres and key high streets in these markets, the report added.
With a significant 2.8 million sq ft share in leasing activity, Bengaluru, alone, surpassed the combined leasing volume of Delhi-NCR and Mumbai. Notably, the share of other cities such as Hyderabad and Chennai increased from 10 per cent and 5 per cent of the leasing volume in 2023 to 14 per cent and 10 per cent at the end of 2024, respectively, the report added.
"2023 witnessed a five-year high as new retail supply of 6.2 million sq. ft became operational across the top 7 cities. The addition of 16 new retail developments in 2023 supported the expansion plans of retailers and helped in reaching gross leasing high of 8.7 million sq ft in the year," said Dr Samantak Das, Chief Economist and Head of Research & REIS, India, JLL.
"However, the new supply in the retail sector in 2024 plunged by 73 per cent y-o-y hampering the new retail space take-up by interested retailers looking for quality retail spaces. Despite this decline in new retail supply, the leasing moderated only by 6 per cent over 2023 to 8.1 million sq ft.Retailer appetite for prime retail locations remained firm throughout 2024 and categories such as Fashion and Apparel continued to amass the highest percentage share in the total retail leasing pie," he added.
In 2024, 27 new brands of international origin entered India, nearly doubling from 14 in 2023. In the past four years, 60 retailers of international origin have forayed into the country to cater to Indian consumer's perpetual preference for global brands.
The report added that the entry of these brands in 2024 represents a 45 per cent share of the total international brands that entered India since 2021. Beauty, Cosmetics and Wellness, Footwear, Bags and Accessories and Fashion and Apparel were the top three retailer categories to set retail footprints in the country in 2024.
Direct-to-Consumer (D2C) brands also contributed to 8 per cent share in total leasing, as per the report.
Both malls and high streets remained equally popular for India's D2C brands seeking to establish a connection and brand identity with the discerning consumers spoilt for choice, the report added.
- ANI