The demand for shopping mall space in India has outpaced supply for the third consecutive year, as per the latest RELEAP by ANAROCK Retail. With rising urbanization, higher incomes, and changing shopping habits, malls are filling up faster, leading to lower vacancy rates and higher rents.
Key Takeaways:
- More Stores, Less Space: In 2024, 6.5 million sq ft of retail space was leased, while new supply struggled to keep up, reducing mall vacancy rates to 7.8%.
- Bigger Stores Preferred: Retailers are choosing larger store spaces (2,000-5,000 sq ft) due to high demand and limited availability.
- Popular Shopping Categories: Beauty, personal care, and departmental stores saw an 11% growth, while apparel and accessories made up 40% of all retail leasing.
- Falling Vacancy Rates: Mall vacancy has dropped from 15.5% in 2021 to 7.8% in 2024, with top malls nearly full.
What’s Coming Next?
New mall developments are in progress, with NCR, MMR, and Hyderabad leading the way, accounting for 78% of upcoming supply. Some major projects include:
- World Mark, Aerocity (30 lakh sq ft, NCR)
- Ramsons Trends Square Mall (10 lakh sq ft, Bangalore)
- Orion Mall (10 lakh sq ft, Hyderabad)
Rising Rents:
As mall spaces become scarce, rental prices are climbing. High-demand areas include:
- South Extension, Delhi: ₹800-1,000/sq ft
- Linking Road, Mumbai: ₹800-1,000/sq ft
- MG Road, Bangalore: ₹250-350/sq ft
Who’s Leasing the Most?
Top retailers expanding their presence include Lifestyle International (15.7 lakh sq ft), Reliance Projects (15 lakh sq ft), and PVR Limited (11.1 lakh sq ft).
The Bigger Picture:
Shopping malls are evolving beyond retail, offering dining, entertainment, and unique experiences to attract customers. With demand continuing to soar, the sector is expected to keep growing, but new supply will be crucial to meet this demand and stabilize rents.
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