High-street dominates retail leasing with 68% share in Q3 2024

High streets dominated retail leasing during the July-September quarter, accounting for 68% of the total 1.6 million square feet (MSF) leased. Hyderabad, Delhi-NCR, and Chennai contributed to 70% of the total main street leasing volume. According to Cushman & Wakefield data, robust demand on high streets has driven rental growth, particularly in Delhi-NCR, Bengaluru, Chennai, and Kolkata, where rents rose by up to 15% YoY. In contrast, leasing activity in malls was relatively subdued, constituting just 32% of the total leasing volume, due to the lack of new mall supply in Q3 2024.

"The Indian retail sector is evolving rapidly, with main streets continuing to experience high leasing activity due to limited mall supply. This strong demand-supply dynamic has led to rental growth, especially in Delhi-NCR and Pune. Malls, however, faced a quieter quarter owing to a lack of supply, a gap expected to be addressed in Q4," said Head of Retail and Managing Director, Capital Markets, Cushman & Wakefield Mr. Saurabh Shatdal. The report also highlights tightening vacancy rates, particularly in Grade-A malls across major cities, which have significantly declined due to high demand from international brands. Foreign brands accounted for 30% of leasing volume in malls for the year 2024. With no new mall supply in Q3 2024, around 1.8 MSF of Grade-A malls are expected to open in Q4, primarily in Mumbai, Delhi-NCR, and Pune, offering fresh options for retailers amidst the tightening vacancy.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.