Demand for quality retail space in major malls and high streets has been on the rise in Mumbai

CBRE South Asia Pvt. Ltd, the Indian real estate consultancy, has announced the findings of its latest retail report, “CBRE India Retail Figures H1 2022”. Supported by high footfall, demand for quality retail space in major malls and high streets has seen an increase in Mumbai, according to the report.

Among the major retail categories, rentals were driven primarily by home goods and department stores with a 55% share of total rentals, followed by foodservices (18%) and fashion & clothing. clothing (11%).

The main transactions recorded during the first half of 2022 in the city were:

  • IKEA has leased 72,000 square feet in the R City mall
  • Copper Chimney has leased 4,800 square feet in the Infiniti Mall
  • Levi’s leased 3,800 square feet in Oberoi Mall

Homeware and department store brands, foodservice players and fashion and apparel retailers with a strong customer base, brand recognition and ability to create their own retail ecosystem have opened stores in secondary and outlying locations.

The report says rental in India’s retail sector grew by around 166% year-on-year, crossing 1.5 million square feet. In the first half of 2022, the total inventory of investment-grade shopping centers exceeded 77 million square feet.

The report highlights that among cities, Delhi-NCR and Pune, followed by Bangalore and Hyderabad, led the rental activity, together accounting for more than 70% of overall retail space take-up. According to the report, pent-up supply is expected to enter the market in the second half of 2022, and total supply for the year is expected to exceed pre-pandemic levels. The rental dynamic should accelerate in H2 2022 due to the expected take-up in the newly completed galleries.

The report also observed that due to strong demand from retailers in malls and prime shopping streets, rental values ​​increased on a semi-annual basis in some micro-markets in most cities. Among the main streets, rents increased by around 5-12% in parts of Delhi-NCR, Bangalore, Hyderabad and Pune, and by around 1-3% in Mumbai. While major shopping mall clusters in Pune and Delhi-NCR saw rent growth of 5-11% on a semi-annual basis, a marginal increase of 1-3% was reported in a shopping mall cluster in Mumbai .

Anshuman Magazine, Chairman & CEO – India, South-East Asia, Middle East & Africa, CBRE said, “It is evident that retailers have regained confidence and are ready for expansion mode. We expect that in the future, national brands will remain proactive in relocations/expansions, and that the strong appetite of international retailers will continue. We expect commercial leasing to hit 6-6.5 million square feet in 2022, double the quantum of 2021. Additionally, due to huge growth potential, we expect many international brands launch stores in Tier II and Tier III markets.

Ram Chandnani, Managing Director, Advisory & Transactions Services, CBRE India added, “We expect approximately 5.5 to 6.0 million square feet of new investment-grade shopping centers to be operational during the year, or annual growth of nearly 40%. Accounting for almost 85% of all investment-grade mall completions, Hyderabad, Delhi-NCR and Bangalore are expected to dominate the addition of retail supply in H2. Additionally, Mumbai and Chennai are also expected to see an increase in supply. Among the consumer segment, fashion and apparel retailers will continue to expand their physical sales networks and pay particular attention to improving flagship stores.

Comments are closed.