New Delhi: According to Cushman & Wakefield, the rental of retail spaces in shopping malls increased by 15 per cent each year during the April-June period to 6.12 lakh square feet in eight major cities due to increased demand from retailers.
According to data from Cushman & Wakefield India, the need for retail space on major high streets in eight major cities grew by 4 per cent each year to almost 14 lakh square feet in the second quarter of 2024. The leasing in shopping malls increased to 6,12,396 square feet in April-June 2024 from 5,33,078 square feet in the same period last year.
During the period being assessed, leasing in high street locations increased by 4 percent to 13,89,768 square feet from 13,31,705 square feet. The leasing information covers Grade A and Grade B shopping malls as well as all well-known mainstreets. The list of cities includes Delhi-NCR, Mumbai, Chennai, Kolkata, Bengaluru, Hyderabad, Pune, and Ahmedabad. In his remarks on the report, Saurabh Shatdal, who is the Head of Retail and Managing Director of Capital Markets at Cushman & Wakefield, mentioned that the second quarter of 2024 witnessed a significant increase in demand for Grade A malls and high street retail. The increase in both formats highlights the liveliness of India's retail sector. He mentioned that although high street rental growth has been on the rise, the introduction of 4.5 million square feet of Grade A mall supply could help stabilize rental prices in the short to medium term by adjusting demand-supply dynamics.
Nevertheless, we expect the main street activity to stay strong. Moreover, Shatdal mentioned that the changing retail preferences in India are underscored by the strong presence of domestic brands, which make up 53 pc of leasing volume, as well as the impressive performance of fashion and F&B sectors.
The consultant emphasized that main-street retail leasing remains dominant due to few new mall openings and a high demand for top-notch retail spaces. Retailers are placing a growing emphasis on main streets in key locations throughout India, leading to the development of new groups around residential and commercial centers.
C&W stated that the shift can be seen in leasing trends, with 70 pc of total leases in Q2 (April-June) 2024 being high street leases, while mall leases accounted for 30 pc .The increasing attractiveness of well-known main streets is highlighted by the growth in rent in Q2 of 2024.
Kolkata, Bengaluru, Hyderabad, and Mumbai have all seen notable increases in rental prices year after year, indicating a strong demand and growth potential for high-street retail in India.
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