Retail leasing in India increased 114 per cent year-on-year (y-o-y) during January-September 2022. Supply grew 102 per cent q-o-q in the third quarter 2022. Among cities, Hyderabad (29 per cent), Delhi-NCR (25 per cent), Mumbai (13 per cent) and Bengaluru (12 per cent) together accounted for 79 per cent of the overall retail space absorption, according to a report by leading real estate consulting firm CBRE South Asia.
Fashion and apparel retailers continued to drive the leasing activity with a share of 46 per cent in the third quarter of 2022. Other prominent categories that led absorption during Q3 2022 included food & beverage (13 per cent), followed by consumer electronics (9 per cent), CBRE said in its report titled ‘India Market Monitor – Q3 2022’.
The report also reported quarterly rental growth in select pockets of Delhi-NCR (Green Park 5-7 per cent), Ahmedabad (Prahlad Nagar 3-5 per cent) and Mumbai (South Mumbai 1-2 per cent). The regional share of leasing activity was led by domestic corporates (73 per cent), EMEA corporates (16 per cent) and American corporates (9 per cent) in Q3 2022.
Anshuman Magazine, chairman and CEO (India, South-East Asia, Middle East & Africa) of CBRE, said, “Nearly 40 per cent y-o-y growth in leasing activity was observed in the retail sector in Q3 2022 and 114 per cent y-o-y between January-September 2022. Owing to the high growth potential, we expect many international brands to continue to view India as a growth market.”
Ram Chandnani, managing director (advisory & transactions services) of CBRE India, said, “Retail leasing is expected to further strengthen during the current festive season. In Q3 2022, the overall retail absorption and supply was 1.1 million sqft and 0.5 million sqft, respectively. Strong leasing momentum across Hyderabad, Delhi-NCR, Mumbai and Bengaluru indicates regained retailer confidence and expansion potential.”
On investment, it said the total capital inflows in the nine months of 2022 was up by nearly 10 per cent y-o-y to $5.3 billion. Overall capital inflows in Q3 2022 were up by 7 per cent y-o-y ($1.4 billion). Mumbai, Bengaluru and Hyderabad dominated total investment quantum in Q3 2022, with a cumulative share of about 66 per cent.
“Institutional investors led investment activity with a share of nearly 59 per cent, followed by developers (19 per cent). Domestic investors dominated the investment volume in Q3 2022 with a share of 51 per cent. Foreign investors garnered the remaining share. Among them, investors from Singapore (24 per cent), followed by Abu Dhabi (14 per cent) pumped in major capital in India,” the report said.
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