New Delhi: India's smaller malls are transforming into ghost malls at an escalating rate as consumers increasingly shift towards online shopping and larger retail destinations for an enhanced shopping experience, several reports have suggested.
Malls with a vacancy rate exceeding 40 percent are now being classified as ghost malls.
The retail sector has witnessed a notable increase in underperforming assets, as 13.3 million square feet of shopping space continues to sit vacant, translating to a staggering revenue loss of 67 billion rupees ($802.5 million) for developers in 2023, according to statistics access by Business North East.
Despite a 238 percent year-on-year surge in the Gross Leasable Area (GLA) of all major shopping centres across key Indian markets in 2023, the count of ghost malls climbed to 64, up from 57 in 2022.
Private consumption, constituting 60 percent of India's gross domestic product (GDP), has shown persistent fragility, with a modest 3.5 percent year-on-year uptick in the final quarter of 2023, despite the economy expanding by 8.4 percent.
However, the country is set to become the third largest consumer market in 2026, surpassing Germany and Japan, according to a UBS report. At present, India is the fifth largest economy in the world.
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