Driven largely by rising consumption, the rebound in the Indian retail market has been exemplary in 2022 which is favorably impacting retail real estate across the country, finds a joint report by real estate consultants ANAROCK and Retailers Association of India (RAI). Buoyed by the growth, developers now plan to add nearly 25 mn sq ft of new mall space across the Top 7 cities over the next 4-5 years, finds the report titled 'India Retail Real Estate: REvived, REshaped, & REinforced'.
NCR and Hyderabad account for nearly 46 percent of the total new upcoming supply, closely followed by Bengaluru at 19 percent. Back in 2022, the top 7 cities added over 2.6 mn sq ft of mall space which was 27 percent more than the preceding year (2021).
“The festive season, devoid of restrictions and any fear of the contagion, was exemplary with record high volumes and sales value," said Anuj Kejriwal, CEO & Managing Director, ANAROCK Retail. "Sales value estimated during the festive season in late 2022 was INR 2.5 Lakh Crore, nearly 2.5 times compared to the previous year. The revival of consumer sentiments and penchant for consumption is therefore being promptly acted upon by the majority of brands, retailers, and mall developers. The new planned mall supply across the top 7 cities is testimony to the developers’ expansion strategy.”
“Further, the retail market size is expected to touch $2 trillion by 2032, growing from $690 billion in 2021, facilitating the organized retail sector to grow at 25 percent CAGR.”
Kumar Rajagopalan, CEO, the Retailers Association of India (RAI) stated, "The report also highlights that the Indian retail sector attracted around USD 1,473 Mn between 2019 and 2022, of which 76 percent of total investments came in 2019 itself. Among the cities, Hyderabad and MMR accounted for nearly 40% of the total PE investments in the sector."
"Data further indicates that back in 2022, the top 7 cities added nearly 2.6 mn sq ft of mall space during 2022, which increased by 27 percent over the previous year (2021)," asserted Rajagopalan. "Among the cities, Bengaluru and Hyderabad were the only cities which saw new mall supply addition during 2022."
Presently, the top cities have over 51 mn sq ft of mall stock across the country with NCR, MMR, and Bengaluru accounting for 62 percent of the total stock. In terms of avg. rentals in malls, these appreciated by nearly 15 percent in 2022 over the previous year, thus reaching higher than the pre-pandemic levels. Bengaluru registered the highest uptick in rentals of around 27 percent, followed by Kolkata at 20 percent in 2022 over the previous year.
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