01 January 2025, Mumbai
India’s retail real estate sector is projected to conclude 2025 with a historic leasing volume of 9 million sq ft, the highest annual absorption recorded since the pandemic. According to Cushman & Wakefield’s India Outlook 2026 report, this 15 per cent Y-o-Y increase from 7.8 million sq ft in 2024 is primarily driven by a decisive surge in mall-led activity. After a prolonged period of limited availability, approximately 4.3 million sq ft of new Grade A mall supply is becoming operational in the final quarter of 2025, enabling apparel and lifestyle giants to finally execute expansion plans that had been deferred due to space constraints.
Premiumization and strategic realignment toward experience-led formats
The market is entering a phase of ‘meaningful capacity addition’ where the focus has shifted from transactional square footage to curated, experience-led lifestyle destinations. Fashion remains the dominant driver, accounting for over 21 per cent of total leasing, followed closely by food and beverage (F&B) and entertainment. This uptick highlights the catalytic role of fresh completions in unlocking demand, states Gautam Saraf, Executive Managing Director, Cushman & Wakefield. As global brands and domestic powerhouses compete for limited Grade A+ assets, the sector is also extending its reach into Tier II cities, supported by a robust 2026 pipeline of nearly 11 million sq ft, which is expected to further institutionalize India's organized retail footprint.
Retail leasing in India targets premium Grade A+ malls and dominant high streets across eight major metros. Driven by a 2024-2026 strategic shift toward premiumization, the sector expects to add 55 million sq ft of space by 2027 to satisfy rising consumption, following record post-pandemic absorption levels.
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