Retail Leasing in India is Projected to Grow Massively in 2023

Retail Leasing in India in 2023

In 2023, mall owners / developers are anticipated to lease 5-6 million square feet of space, topping the pre-Covid peak of 2019 by a significant margin.

According to research - fashion & clothing, homeware, and department retailers would likely dominate leasing activity as they seek to establish more stores this year to make up for their sluggish growth during the first two years of the epidemic.

As leading retailers like as Reliance Retail, Aditya Birla Fashion and Retail (ABFRL), DMart, Tata's Trent, and Starbucks continued to open new locations, many businesses are seeking more space. India's robust domestic demand would continue to bolster the retail sector, which in 2023 would see a robust supply pipeline, hence boosting leasing activities.

In 2022, retailers in India leased around 4.7 million square feet of space in major cities. Recently, Mango launched a flagship shop in Bangalore, while Reliance Retail announced the establishment of the first Gap store in India at the Infinite Mall in Malad, Mumbai.

Recently, Latin Quarters announced the addition of a new standalone shop in Bangalore to its retail base in South India. In addition to building new shops, several businesses are expanding their existing locations to provide consumers with a richer shopping experience.

According to a research, when new malls open, merchants may lease up to 60 million square feet of space in 2023 in India.

Although global headwinds might impair discretionary retail purchasing, cautious optimism among Consumers, varied store locations, and multichannel sales techniques are expected to assist the retail industry in navigating the future normal.

Despite rising rentals, retailers such as Levi's, Tasva of Aditya Birla Fashion and Retail Limited, eyewear brand John Jacobs, Celio, Puma, Apparel Group India that sells brands such as Aldo, Charles & Keith, and Bath & Body Works, and restaurant operators Chrome Hospitality that operates multiple large format restaurants in Mumbai have increased the average store size by 30-40%, while a few have doubled it. The expansion intentions of retailers are boosting citywide lease activity.

Given the development momentum and market research, Delhi-NCR is projected to become one of the leading Indian cities in the next years, accounting for over half of the planned mall supply.