India retail leasing hits record 8.9 million sq. ft in 2025 on strong demand, fresh supply
- IBEF
- January 29, 2026
India’s retail real estate market scaled a new historic peak in 2025, with leasing across major cities touching approximately 8.9 million sq. ft. This historic absorption was achieved despite the global macroeconomic environment continuing to be challenging and represents a key milestone in the story of domestic consumption. Much of the growth in leasing activity was driven by strong demand for the Fashion & Apparel sector, which accounted for nearly 48% of the total absorption. Additionally, Direct-to-Consumer (D2C) brands emerged as a vital demand driver, contributing roughly 27% of the leasing volume as online-first players accelerated their physical footprint to drive brand awareness and enhance unit economics. The Food & Beverage (F&B) sector also remained a key contributor, making up 12% of the total take-up with a clear preference for experiential, large-format concepts.
The incredible demand is being met by significant new supply, with retail developments adding nearly 4.3 million sq. ft of new space during the year, marking an astounding increase of 268% over 2024 levels. Hyderabad emerged as the frontrunner, accounting for more than half of the annual supply additions, followed closely by Mumbai and Delhi-NCR. Mr. Anshuman Magazine, Chairman and CEO, India, South-East Asia, Middle East & Africa at CBRE, noted that this growth indicates a market shift toward quality and experience. Retailers are adopting innovative engagement strategies, such as experiential flagship stores and Gen Z-focused locations. Furthermore, the use of AI tools for virtual fitting and predictive inventory management is facilitating the case for physical retail. Supported by stable inflation and recent government fiscal rationalisations, both domestic and international companies are expected to continue making significant investments in India’s evolving retail sector.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
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