Over 8.6 mn sq ft of new mall supply in the superior Grade A category, says a C&W report
Over 70% of the 12.3 million sq ft (msf) of new Grade A mall supply expected over the next two years will be a superior grade (Grade A+), marking a significant upgrade in quality and experience across India’s upcoming retail infrastructure, according to a report by Cushman and Wakefield.
The report titled Premiumisation of India’s Retail Sector – Upscaling, Upgrading and Evolving said that about 8.6 million sq ft of the upcoming mall portfolio will be in the superior grade category.
The superior-grade malls typically owned and operated by reputed developers or institutional investors are characterized by their high occupancy rates (more than 85%), upscale tenant mix, and service-rich environments.
India’s total Grade A mall stock stood at 61.5 million sq ft in 2024, with superior-grade malls already comprising 63% (38.9 million sq. ft.) of the total. These malls are outperforming their peers, with stock-weighted average rents rising by 29% since 2019, currently averaging ₹315 per sq ft per month.
Metro cities like Delhi NCR, Mumbai, Bengaluru and Pune lead the Grade-A mall stock, with Delhi NCR alone accounting for 21.75 msf. Superior-grade assets within these metros are witnessing strong investor and retailer interest, driving rental growth and low vacancy rates of around 3-4%.
Also Read: Delhi’s Connaught Place sees 14% increase in rent for retail spaces, Khan Market 7% in Jan-Mar: C&W
Premiumisation expands to High Streets amid mall space constraints
The report said that with limited space available in top-grade malls, many premium brands have increasingly turned to high streets across India’s top eight cities to establish their presence. Key high street locations such as Linking Road in Mumbai, Khan Market and Connaught Place in Delhi, and M.G. Road in Bengaluru have emerged as popular alternatives.
Although often considered part of the unorganised retail segment, these high streets offer a significant advantage — high visibility to passing foot traffic. This direct exposure has made them attractive to brands seeking strong consumer engagement outside traditional mall environments.
Over the past few years, rentals in these prominent high street locations have not only recovered from the COVID-era slump but have also surpassed their 2019 peaks. The steady rise in rental values highlights the growing demand from premium retail brands for these well-trafficked and high-visibility spaces.
Also Read: Demand for logistics, industrial spaces to touch 50-53 million sq ft in 2024: Report
Beauty, athleisure, and F&B take centre stage in mall leasing
The report highlighted a transformation in India’s mall landscape, driven by the rise of premiumisation.
Traditional anchor tenants such as hypermarkets and cinemas are seeing a decline in prominence, while categories like fashion, beauty, wellness, and experiential dining are emerging as major footfall and spending drivers. In particular, beauty and wellness, food and beverage (F&B), and athleisure have witnessed strong growth in mall presence, propelled by high trading densities and deeper consumer engagement.
The beauty and wellness segment has especially benefited from this shift, gaining traction over the past 5–6 years. It recorded an average trading density between ₹8,000 and ₹12,000 per month, positioning it as a key focus area for mall managers aiming to boost revenue and customer retention.
F&B has evolved into a new-age anchor category, often surpassing traditional department stores in its ability to draw crowds. With evolving consumer preferences favoring experiences over transactions, dining spaces have become central to the modern mall experience.
Additionally, the report noted a steady rise in categories like jewellery and Consumer Durables and Information Technology (CDIT), signalling an increased consumer appetite for premium and tech-oriented products.
