Leasing of retail space in Jan-Jun jumps 2.5 times across 8 cities to 1.54 million sq ft

New Delhi: Leasing of retail space jumped more than 2.5 times across eight major cities to 1.54 million square feet during January-June 2022 on better demand, according to property consultant CBRE.

Absorption of retail space stood at 0.58 million square feet in the corresponding period of the previous year.

"It is evident that retailers have regained confidence and are set for expansion mode. We anticipate that going forward, domestic brands will remain proactive in relocations/ expansions, and a strong appetite from international retailers will continue," said Anshuman Magazine, Chairman & CEO - India, South-East Asia, Middle East & Africa, CBRE.

He said retail leasing could touch 6-6.5 million square feet in 2022, twice the 2021 quantum.

"Additionally, owing to the tremendous growth potential, we expect many international brands to launch stores in tier II and III markets," Magazine said.

As per the data, leasing of retail space in Delhi-NCR rose to 0.33 million square feet during January-June 2022 from 0.05 million square feet in the year-ago period.

In Mumbai, absorption of retail space rose to 0.13 million square feet from 0.05 million square feet.

Leasing of retail space in Bangaluru increased to 0.24 million square feet from 0.20 million square feet, while that in Chennai it rose to 0.20 million square feet from 0.02 million square feet.

In Hyderabad, retail space leasing increased to 0.24 million square feet from 0.17 million square feet.

Absorption of retail space in Pune jumped to 0.33 million square feet from 0.06 million square feet. In Ahmedabad, the leasing rose to 0.03 million square feet from 0.01 million square feet.

In Kolkata, the leasing went up to 0.05 million square feet during January-June 2022 from 0.03 million square feet in the same period last year.

Ram Chandnani, Managing Director, Advisory & Transactions Services, CBRE India, said, "We expect nearly 5.5- 6 million sq ft of new investment-grade malls to become operational during the year, an annual growth of nearly 40 per cent." Among the consumer segment, he said, fashion and apparel retailers will continue to expand their physical sales networks and pay particular attention to enhancing flagship stores.

On innovation in tenant mix, CBRE said the last two years have resulted in a rise in demand for service-oriented retailers, including beauty, medical, pet, childcare, and entertainment.

"Keeping in view the larger consumer experience, landlords are anticipated to place much greater importance on this sector in their tenant mix and, in doing so, could redefine 'consumer spaces'," the consultant said.