A Cushman & Wakefield report estimates that over the next four years, India will need about 55 million square feet (msf) of Grade A mall space to keep up with demand and match other south Asian economies like Indonesia, the Philippines, Thailand, and Vietnam in terms of Retail Space Per Capita (RSPC), which is is Grade A mall space divided by the total population.
The Resurgent Retail: Powered by Rising Retail Consumption report, which was presented at MAPIC India 2024 in Mumbai, stated that improving the rate of quality retail developments is urgently needed, since they have so far been delivered at a relatively slow pace.
In the last eight years, only 2.5 million square feet on average of Grade-A mall complexes have opened for business in India’s retail industry. That means that in the last eight years, only 20 msf of new Grade-A malls have been created, even though during that time, consumer demand has steadily increased.
The combined Grade-A mall inventory of India’s top eight cities currently stands at 61 million square feet, or just 0.5 square feet of retail space per capita. This is far less than that of even smaller nations like Indonesia, the Philippines, and Vietnam.
In order to achieve a 1.0 RSPC by 2027—which is equivalent to Indonesia, the closest appropriate comparison given their very similar per capita incomes—the report stated that over the following four years, some 55 million square feet of mall space will need to be built. Currently, just 18 million square feet are anticipated to be added to the pipeline of Grade-A retail mall developments between 2024 and 2027.
The research also emphasises how multinational retailers, many of which are considering entering the Indian market, are finding the sector to be increasingly appealing.
The study claims that as of 2024, there were 25 international brands on average entering India, up from an average of 12 in the years prior to the COVID-19 pandemic. This indicates that there is increasing optimism over the retail potential of the nation. It stated that the increase in foreign brands is boosting the need for upscale retail locations and adding to the industry’s general vibrancy.
