Amid rising consumption, new shopping mall supply is expected to increase dramatically. According to the latest Anarock research, 16.6 million square feet of new-grade shopping mall space will be added in 2025 and 2026.
Hyderabad and Delhi-NCR will account for 65% of this supply. The surge is part of a wider pipeline that could add 40 million square feet of retail space by 2029 in major urban centers.
“The surge is also due to the perceived inadequacy of new A-level shopping malls throughout the city. Data trends from the previous three years indicate that new mall supply in the first seven cities do not match overall rentals,” said Anuj Kejriwal, CEO and MD, Anarok Retail.
From 2022, these cities will have about 2.6 million square feet of new retail supply, while leases are about 3.2 million square feet, 5.3 million square feet of new-grade A-level shopping malls are available in 2023, while 6.5 million square feet of 6.5 million square feet of 6.2 million square feet of leases are about 3.2 million square feet, and 6.5 million square feet of leases are about 3.2 million square feet, and 6.5 million square feet of leases are about 3.2 million square feet.
In 2024, this demand gap widens due to general and state elections, slowing approvals due to approvals narrow.
“The new Class A shopping mall supply in 2024 is only 1.1 million square feet, while the rental is 6.5 million square feet,” Kejriwal added.
Anarock data predicts that the total lease for total shopping mall rentals will exceed 12.6 million square feet in the next two years. The entry of international retail brands in various categories in India, such as fashion, electronics, lifestyle and F&B, has also driven strong rental rates.
This is why there is a high demand for high-end organized retail spaces, especially in high-foot fall areas such as shopping malls and high streets.
The data also shows that as demand imbalances gradually normalize in previous years, the shopping mall vacancy rates in the top 7 cities will stabilize in 2025 in the next two years, at 8.2% in 2026 and 2021 in 2021. In 2021, the vacancy rate in these cities is as high as 15.5%.
Due to the increase in disposable income and digital adoption, the second and third floor cities have also become hotbeds of consumption. The industry estimates that the entire online shopping pie share will be 56%, and predicts that it will reach 64% in fiscal 2030 in these cities. The number of online shoppers in India is expected to double to 300 million by 2030.
(With the input of BL intern Nethra Sailesh)
Published on May 13, 2025
