Retail leasing in the country increased by 114 per cent to 3.4 million square feet during January-September 2022, compared to 1.6 million sq. ft during 9M 2021, states a report.
The top cities—Hyderabad (29 per cent), Delhi-NCR (25 per cent), Mumbai (13 per cent), and Bangalore (12 per cent)—together accounted for 79 per cent of the total retail space absorption, finds the latest report by the CBRE South Asia.
The retail sector saw a total capital inflow of $5.3 billion during this time, an improvement of 10 per cent over the 9M 2021. The report shows that investments were dominated by land and development sites, which accounted for 51 per cent of total investments, followed by built-up office assets for 49 per cent. With a stake of roughly 59 per cent, institutional investors led the investment activity, followed by developers (19 per cent).
“Nearly 40 per cent Y0Y growth in leasing activity was observed in the retail sector in Q3 2022 and 114 per cent Y-o-Y between Jan–Sept 2022. Owing to the high growth potential, we expect many international brands to continue to view India as a growth market,” said Anshuman Magazine, chairman and CEO - India, South-East Asia, Middle East, and Africa, CBRE.
Leasing activity in the office sector improved by 66 per cent YoY to 42.1 mn sq. ft during 9M 2022. According to the report, the ease of Covid-19 restrictions, gradual acceleration of return to the office (RTO), expansion by occupiers, and the release of post-pandemic pent-up demand are the reasons for the sector’s improvement.
“Retail leasing is expected to further strengthen during the current festive season. In Q3 2022, the overall retail absorption and supply were 1.1 mn sq. ft. and 0.5 mn sq. ft., respectively. Strong leasing momentum across Hyderabad, Delhi-NCR, Mumbai and Bangalore indicates regained retailer confidence and expansion potential,” said Ram Chandnani, managing director, Advisory and Transactions Services, CBRE India.