The Fashion and Apparel sector in India has shown strong growth, accounting for 40% of real estate leasing activity in the first quarter of 2024. Mid-segment brands led this surge, capturing 40% of the market, followed closely by value segment brands at 38%. This indicates a positive outlook for the organized retail market post-COVID-19, with new infrastructural developments across urban centers and emerging cities. In the same period, 1.1 million square feet of retail spaces were leased, with the majority of leasing activities being dominated by mid-sized and value segment brands.
Following the Fashion and Apparel sector, the food and beverage industry also saw significant growth, contributing 21% of leasing activities. Experiential dining brands accounted for 38% of this segment, showcasing a growing trend in consumer preferences. The report also highlighted that domestic brands dominated leasing activities with a 76% share, with many stores being multi-brand outlets facilitating the entry of global Beauty and Cosmetics brands into the Indian market. Seven foreign brands also chose India for their first outlets, with Mumbai and Delhi NCR being top choices, indicating a growing interest in the Indian market.
Rahul Arora, Head of Office Leasing and Retail Services at JLL, stated that the organized retail market in India has seen a surge in new developments, leading to increased launches in urban centers and emerging cities. This has motivated retailers to expand their presence into new markets, bringing them closer to consumers. The report also highlighted low vacancy levels in top-quality retail centers, around 6%, while average retail developments experience higher vacancy rates of approximately 20%. Efforts are being made to revitalize underperforming retail spaces to meet evolving market demands.
Top-quality retail spaces with high footfall remain in high demand across India, with both international retailers and leading national brands showing interest in superior-grade retail developments. The report underlined the importance of revitalizing non-performing retail spaces to adapt to changing market trends and meet consumer demands. With a positive outlook for the organized retail market, India is poised for continued growth in the Fashion and Apparel sector, as well as other industries like food and beverage. This surge in leasing activities reflects a growing confidence in India’s retail landscape and its potential for further expansion.
