JLL India predicts 43% surge in retail space supply by 2027 across major cities

Retail real estate market in India: The retail real estate market in India is poised for significant growth, with a projected 43 per cent increase in new retail space supply across seven major cities by 2027, according to a report by JLL India titled 'India Retail: Evolving to a New Dawn'. As of H1 2023, the operational retail space in shopping malls in the top seven cities, including Delhi-NCR, Mumbai, Pune, Bengaluru, Kolkata, Chennai, and Hyderabad, stood at 89 million square feet. Among these cities, Delhi-NCR had the largest operational retail stock at 28 million square feet, followed by Mumbai with 17 million square feet and Bengaluru with 14 million square feet.

JLL's report highlights that the physical retail space segment is expected to witness a supply pipeline of over 38 million square feet of retail developments between H2 2023 and 2027 across these top seven cities. 

Delhi-NCR to contribute 11.6 million square feet

Delhi-NCR is anticipated to contribute significantly to this supply with 11.6 million square feet, accounting for 31 per cent of the expected new supply. Other cities like Bengaluru, Chennai, Hyderabad, Kolkata, Mumbai, and Pune will also witness substantial new retail space additions. In H1 2023, the gross leasing of retail space in shopping malls and prime high street locations in these top seven cities amounted to 3.16 million square feet.

Rahul Arora, Head of Office Leasing Advisory and Retail Services, India, JLL, was cited by PTI as saying that India's retail sector is experiencing robust growth, focusing on creating innovative environments, strengthening connections with consumers, and expanding physical storefronts in previously untapped regions, including Tier-2 and 3 cities.

Industry leaders, including Manoj Gaur, CMD of Gaurs Group, and Vinod Rajpaul, CEO of Ocus Group, were also cited as attributing this growth trend to favourable global perceptions, high growth opportunities, rapid economic progress, and optimistic investor sentiments. They also observed a surge in foot traffic in malls, especially after the COVID-19 pandemic, leading to increased demand for quality retail spaces and a corresponding rise in lease rentals.

(With PTI inputs)