Q3 retail leasing up significantly

07 November 2022, Mumbai:

Retail leasing in India increased by 114 per cent in the third quarter. Hyderabad, Delhi-NCR, Mumbai, and Bangalore together accounted for 79 per cent of the overall retail space absorption. Fashion and apparel retailers continued to drive the leasing activity.

Other prominent categories that led absorption included food and beverage followed by consumer electronics. The regional share of leasing activity was led by domestic corporates, EMEA corporates, and American corporates.

Owing to the high growth potential, many international brands are to continuing to view India as a growth market. Strong leasing momentum across Hyderabad, Delhi-NCR, Mumbai, and Bangalore indicates regained retailer confidence and expansion potential. Direct-to-consumer brands are expected to lead the fray among demand drivers. Tier II, III, and even IV locations are gaining traction as retailers look to leverage the spending power of these towns and cities.

Despite a robust supply pipeline, the lack of ready quality supply, especially in prime locations, is likely to impact retailer sentiments. Steady capital inflows are being witnessed in real estate. Land/development sites dominate investments followed by built-up office assets.

Institutional investors led investment activity followed by developers. Domestic investors dominated the investment volume in the third quarter. Foreign investors garnered the remaining share.

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