55 Million Square Feet of Grade-A Malls Needed till 2027 to Meet Growing Demand - Cushman & Wakefield

India’s retail on the brink of a significant transformation and expansion, driven by rising domestic consumption and favourable economic conditions

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Fresh supply of retail space in shopping malls during 2024-27 across eight major cities is expected to be 18 million sq. ft., which is one-third of the projected requirement to meet the demand, according to Cushman & Wakefield (C&W). Real estate consultant C&W in its latest report pointed out that "India's Retail Space Per Capita (RSPC) lags behind other South Asian countries, including Indonesia, Philippines, Thailand, and Vietnam."

The Indian retail sector is on the brink of a significant transformation, driven by rising domestic consumption and favourable economic conditions. According to Cushman & Wakefield's latest report - Resurgent Retail: Powered by Rising Retail Consumption, India requires a substantial increase in premium retail spaces to meet the growing demand. The report estimates a need for 55 million square feet (MSF) of Grade- A mall space over the next four years to keep pace with the market and align with other south Asian economies on the basis of Retail Space Per Capita (RSPC).

Shifting Consumer Landscape Driving Retail Growth

The report highlights a significant shift in consumer spending patterns, with a growing emphasis on discretionary items and experiential retail. This trend is evident in recent data, showing an increase in urban India's spending on discretionary items- from 27% in FY2011-12 to about one-third in FY 2022-23, while spending on essentials has decreased. Additionally, monthly spending on food delivery and credit card usage have surged, reflecting higher consumer confidence and discretionary spending. Gradually, Indians are seen spending more on travel, vehicles and premium consumer durables, states the report.