New Delhi, Feb 22,2023: Driven largely by rising consumption, the rebound in Indian retail market has been exemplary in 2022 and is impacting retail real estate across the country, said 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 million square feet of new mall space across the top seven cities over the next 4-5 years, said the report.

It said that NCR and Hyderabad account for nearly 46 per cent of the total new upcoming supply, closely followed by Bengaluru at 19 per cent.

Back in 2022, the top 7 cities added over 2.6 mn square feet of mall space which was 27 per cent more than the preceding year (2021).

“The festive season, devoid of restrictions and any fear of 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 Rs 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 organised retail sector to grow at 25 per cent CAGR.”

Kumar Rajagopalan, CEO, Retailers Association of India (RAI), said: “The report also highlights that the Indian retail sector attracted around $1,473 million between 2019 and 2022, of which 76 per cent of total investments came in 2019 itself. Among the cities, Hyderabad and MMR accounted for nearly 40 per cent of the total PE investments in the sector.”

“Data further indicates that back in 2022, the top 7 cities added nearly 2.6 million square feet of mall space during 2022, which increased by 27 per cent over the previous year (2021),” he said. “Among the cities, Bengaluru and Hyderabad were the only cities which saw new mall supply additions during 2022.”

Presently, the top cities have over 51 million square feet of mall stock across the country with NCR, MMR, and Bengaluru accounting for 62 per cent of the total stock.

In terms of average rentals in malls, these appreciated by nearly 15 per cent in 2022 over the previous year, thus reaching higher than the pre-pandemic levels. Bengaluru registered the highest uptick in rentals of around 27 per cent, followed by Kolkata at 20 per cent in 2022 over the previous year.