JLL: Retail space leasing volume in 2025 will exceed 2023 levels, with 9 million square feet added in seven major cities

New Delhi [India]January 25 (ANI): Nearly 9 million sq ft of new retail space will be added in India’s top seven cities in 2025, with total leasing expected to surpass 8.7 million sq ft in 2023, according to data from Commercial Real Estate and Investment Management Jones Lang LaSalle India Pvt.

Despite continued interest from international retailers, domestic retailers dominate total leasing volume with over 80% share, with about 6.5 million square feet of leasing space by 2024, the report said.

The report shows that the top seven cities are Mumbai, Delhi-NCR, Bengaluru, Kolkata, Chennai, Pune and Hyderabad.

The report added that total leasing volume in 2025 will easily surpass the 2023 level of 8.7 million square feet, driven by continued interest from international brands and healthy space taken up by domestic retailers.

JLL India said in a report that these retailers leased 8.1 million square feet of space in shopping malls and prominent thoroughfares in India’s top seven cities in 2024.

The report said that despite the constrained inflow of high-quality new space, the retail industry maintained its growth momentum, with retailers expanding their footprint across various retail formats throughout the year, and total leasing volumes falling by only 6% in 2023.

Bengaluru accounted for 34% of the total leasing activity, followed by Delhi NCR (14%) and Mumbai (14%). The report added that 62% of retail space is concentrated in these three metropolitan cities in India, highlighting the strong consumer demand in major retail centers and main high streets in these markets.

Bengaluru alone accounted for 2.8 million sq ft of leasing activity, more than Delhi-NCR and Mumbai combined. Notably, the share of leasing volumes in other cities such as Hyderabad and Chennai increased from 10% and 5% in 2023 to 14% and 10% respectively by the end of 2024, the report added.

“New retail supply in the seven largest cities reached 6.2 million square feet in 2023, a five-year high. The addition of 16 new retail developments in 2023 supported retailers’ expansion plans and helped total leasing volumes reach a high of 8.7% 1 million sq ft this year,” said Dr Samantak Das, chief economist and head of research and REIS, JLL India.

“However, new supply in the retail sector is down 73% year-on-year in 2024, hampering the take-up of new retail space by interested retailers looking for prime retail space. Despite the decline in new retail supply, leasing volumes fell by only 6% % of retail space will increase to 8.1 million square feet by 2023. Retail demand for prime retail locations remains strong in 2024, with categories such as fashion and apparel continuing to account for the highest percentage share of total retail leasing,” he added.

In 2024, 27 new international brands will enter India, nearly double the number of 14 in 2023. Over the past four years, 60 international retailers have entered India to cater to Indian consumers’ eternal preference for global brands.

These brands entering India by 2024 account for 45% of the total international brands entering India since 2021, the report added. Beauty, cosmetics and wellness, footwear, luggage and accessories, and fashion and apparel are the top three retailer categories entering India. Establish retail footprint in the country by 2024.

Direct-to-consumer (D2C) brands also accounted for 8% of total leasing, the report said.

The report adds that malls and high streets remain equally popular for Indian D2C brands seeking to connect and brand with a dizzying array of discerning consumers. (Arnie)