India's retail grows due to realty supply, consumer resurgence: JLL report

After a strong comeback in 2022, the growth momentum of India's retail sector continues to stay strong in 2023, said a report.The Indian retail sector is taking a leap forward by growing sales and revenue and is witnessing unprecedented transformation through the introduction of newer formats, increasing institutional investment, and entry of new global brands, it added.

JLL India's latest report, titled 'India Retail: Evolving To A New Dawn', states that India continues to be a preferred market for international brands. Increased consumption, rising institutional participation, strategic partnerships of Indian retail chains, and a supportive regulatory environment make India a lucrative destination for global brands.

The report added that 24 new International brands have entered India since 2021, making a beeline for superior-quality mall developments in the gateway cities of Delhi NCR, Mumbai, and Bengaluru. Nearly a quarter of these new entrants were in the F&B category.

The report finds that while omnichannel retail is increasingly becoming important, physical stores still play a vital role in providing experiential shopping and social connect experiences to consumers.

The operational retail stock as of H1 2023 in the top seven cities (Delhi NCR, Mumbai, Pune, Bengaluru, Kolkata, Chennai, and Hyderabad) stands at 89 million sq ft. More than 50 per cent of the current operational mall stock lies in Delhi NCR (28 million sq ft) and Mumbai (17 million sq ft). Mall completions of around 1.1 million sq ft were recorded in H1 2023, with additions in Hyderabad and Delhi NCR.

Rahul Arora, head of office leasing advisory and retail services, India, JLL, said, "The shopping mall stock which stands at 89 million sq ft as of H1 2023 is expected to increase by around 43 per cent to reach 127 million sq ft by the end of 2027. With India's first retail Real estate investment trusts (REIT) launched recently, the developers will focus on upgrading their retail assets by churning tenant mix, incorporating entertainment, leisure, and Food and Beverage Services (F&B avenues)."

"Investments into new-age technology and improved user interfaces to appeal to a more tech-savvy, millennial generation are also being undertaken as part of a refreshed brand experience," he added.