Why Retail Real Estate Is Emerging as India’s Most Resilient Investment Asset
By Jatin Goel, Executive Director, Omaxe Group
There is a quiet recalibration underway in how stakeholders are talking about retail real estate in India. Not loudly, not uniformly, but enough to dominate leasing conversations over the last 12-18 months.
What used to be dismissed as cyclical or sentiment-driven is now behaving with certainty. Vacancies in Grade-A malls are, in many cases, no longer a point of negotiation. According to CBRE India, several institutional-grade retail assets are operating at 95-100% occupancy, a number that would have seemed optimistic not too long ago. The more telling detail is not the occupancy itself, but the absence of urgency among landlords. They are willing to wait. That changes the tone of deals.
At the same time, leasing velocity has not softened. JLL Research recorded a 69% year-on-year increase in leasing in the first half of 2025, touching about 5.7 million sq. ft. It would be easy to attribute this entirely to consumption growth. But there is more to that explanation.
This momentum is also visible in more recent data. Retail absorption across the top seven cities stood at 4.3 million square feet in the second half of 2025, reflecting sustained demand from occupiers despite a mixed macroeconomic environment, as highlighted in ANAROCK Retail’s latest RELEAP 2026 report.
Yes, the macro tailwind is visible. A projected $6 trillion consumption economy by 2030, often cited across industry reports, including those referenced by CBRE India, indicates the future trajectory. But on the ground, the shift feels more behavioural than macroeconomic. In any well-performing mall, one can notice that the transaction is kind of incidental. People are not just visiting a mall to buy; rather, they are there to have a good time, where they can also shop. Retail has modified its role as a social infrastructure.
This behavioural shift is also evident in the composition of leasing demand. According to ANAROCK, leasing activity during H2 2025 was led by apparel, followed by entertainment, hypermarkets and supermarkets, and food and beverages, indicating a clear tilt towards experience-led categories.
Developers, for their part, have adjusted. Nearly a third of mall space now tilts towards food, beverage, and entertainment in newer formats, as noted by CBRE India in its assessments. It is not just a design choice. It is a hedge against the unpredictability of pure retail. At the same time, there is a visible format-level shift underway. High streets are beginning to outpace malls in leasing traction, with mid-sized and experiential store formats dominating demand, further reinforcing the idea that physical retail is evolving rather than declining.
Even though q-commerce penetration continues to deepen, the omnichannel strategy has also entrenched itself well. By most conventional logic, this should compress demand for physical space. Instead, the availability of better spaces is getting tighter. Part of the answer lies in scarcity, though that word is used too casually. India still has roughly 0.6 sq. ft. of organised retail space per capita, as per Cushman & Wakefield estimates. That number is less a statistic and more a structural constraint. It explains why even moderate demand can translate into high occupancy.
Institutional capital seems to have understood this nuance earlier than most. The anticipated $3.5 billion inflow into retail assets over the next three years, cited across industry projections including CBRE India, is not chasing yield in isolation. It is pricing in visibility. Rental growth may not be spectacular, but it is legible.
REIT structures and professional asset management have helped, no doubt. They have reduced opacity, standardised expectations, and, perhaps most importantly, made retail investible at scale. That last point often goes under-discussed.
There is also a geographic shift that is harder to quantify but difficult to ignore.
On the supply side as well, the concentration is becoming sharper. Delhi NCR and Hyderabad together account for nearly 70% of the future retail supply pipeline, reflecting developer confidence in these regions. Cities like Lucknow, Chandigarh, and Ahmedabad are no longer peripheral in retail conversations. Demand in these markets is not always deep, but it is increasingly decisive. A well-located, well-managed asset can stabilise faster than its metro counterparts in some cases, largely because there is less competitive supply to fragment footfalls.
In this context, NCR stands out not just as a participant but as a leading indicator of where retail real estate is headed. With a disproportionate share of upcoming supply and sustained leasing momentum, the region reflects both developer confidence and occupier conviction. Within NCR, Faridabad presents a particularly vantage position. Its improving connectivity, relative supply gap, and evolving consumption base place it at a critical juncture where early-stage investment can align with the broader structural tailwinds shaping India’s retail landscape.
Disclaimer: Views expressed in this article are those of the author, and not necessarily of Realty&More.
