Mumbai: India’s organized retail sector is set for massive expansion, with over 16.6 million square feet of Grade A mall space projected to be delivered across the top 7 cities between calendar years 2025 and 2026, according to the latest data from ANAROCK Research. The surge signals a strong rebound in consumer sentiment and retail real estate investment.
Hyderabad and Delhi NCR will lead this growth, accounting for nearly 65% of the new mall supply, highlighting their emergence as key consumption-driven hubs in India’s retail landscape.
“India’s mall development pipeline is heating up again after years of supply lags,” said Anuj Kejriwal, CEO & MD – ANAROCK Retail.
“A substantial shortfall in Grade A supply over the past few years has created pent-up demand. In 2022, new supply in the top cities was only 2.6 Mn sq. ft., while leasing reached 3.2 Mn sq. ft. This gap widened in 2023 and peaked in 2024 due to regulatory delays during election cycles.”
In 2024, only 1.1 Mn sq. ft. of new mall supply was added across top cities, compared to 6.5 Mn sq. ft. of space leased. The discrepancy drove vacancy rates down to 8.2% in 2025 and a projected 8.5% in 2026, far below the 2021 high of 15.5%.
Mall Leasing
Despite concerns of potential oversupply, current absorption trends remain strong. Mall leasing across the top 7 cities is expected to exceed 12.6 Mn sq. ft. over the next two years, with confidence bolstered by robust demand from global and domestic retailers.
More than 60 international brands have entered India over the past four years across fashion, electronics, lifestyle, and food & beverage categories—further fuelling the need for high-grade organized mall spaces, particularly in high-footfall locations and high streets.
Retail Surge Extends to Tier 2 & 3 Cities
The retail revolution is no longer confined to metros. Tier 2 and Tier 3 cities are emerging as powerful consumption markets. E-commerce penetration in these cities has surpassed that of Tier 1 cities, with their share of online shopping expected to reach 64% by FY 2030, up from 56% in FY 2024.
India’s online shopper base has grown from 140 million in 2020 to 260 million in 2024, and is projected to cross 300 million by 2030 and 700 million by 2035, indicating a steady rise in digital consumption and omni-channel retail demand.
