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India’s retail real estate market continued its upward trajectory in Q3 2025, with gross leasing volume (GLV) reaching 2.41 million sq. ft. across the top eight cities, according to a report by Cushman & Wakefield. This represents a 7.6% quarter-on-quarter (q-o-q) increase, underscoring sustained occupier demand despite supply-side constraints.
Year-to-date, retail leasing volumes have touched 7.02 million sq. ft., marking a 25.2% rise over the same period in 2024. With one quarter remaining, the market is well-positioned to surpass last year’s full-year GLV of 7.88 million sq. ft.
Key Highlights:
- Malls vs. High Streets:
Malls accounted for 1.16 million sq. ft. (48% share), registering 15% q-o-q growth, while high streets absorbed 1.25 million sq. ft. (52% share), with a modest 1.5% increase. - Vacancy Trends:
Overall retail vacancy dropped to 7.25%. Grade A+ malls remained highly sought-after, with vacancy rates at just 2.27%, marking the second consecutive quarter without any new Grade A mall supply. - Top Performing Cities:
- Mumbai led retail leasing with a 24.5% share (0.59 MSF), with malls contributing 84% of transactions.
- Delhi NCR and Hyderabad followed with 0.51 MSF each, accounting for 21% of total leasing activity respectively.
- Other key contributors included Bengaluru (0.18 MSF), Pune (0.33 MSF), Chennai (0.16 MSF), Kolkata (0.06 MSF), and Ahmedabad (0.06 MSF).
- Leading Categories:
Fashion (21.4%), Food & Beverage (19.3%), and Entertainment (15.8%) emerged as the primary drivers of demand, reflecting shifting consumer preferences and a continued focus on experiential retail. - Retailer Profile:
Domestic brands dominated leasing activity, accounting for 82.5% of the total. In contrast, international retailers (17.5%) focused primarily on mall locations to leverage footfall and professional infrastructure. - Upcoming Supply:
While supply remains constrained in the short term, an estimated 3 million sq. ft. of new retail space is expected to enter the market in Q4 2025. A larger pipeline of approximately 15.5 million sq. ft. is projected between Q4 2025 and 2027.
Market Outlook:
Commenting on the trends, Gautam Saraf, Executive Managing Director – Mumbai & New Business, Cushman & Wakefield, said:
“India’s retail sector continues to grow, fueled by evolving consumer preferences, higher disposable incomes, and strong demand for quality spaces. While supply constraints exist, the upcoming pipeline should restore balance, making India an attractive market for both domestic and international retailers.”
As consumer sentiment remains upbeat and organized retail continues to gain traction, the Indian retail market is expected to remain resilient and dynamic, supported by strong fundamentals and a growing appetite for experiential shopping environments.
