MAIN STREETS RULE THE RETAIL LANDSCAPE IN Q1’18 : CUSHMAN & WAKEFIELD
- Main streets account for 80% of retail leasing with Apparel and F&B being the main contributors
- 0.85 million square feet (msf) fresh mall supply in Q1’18
- 14.22 million square feet (msf) of new malls are under construction
- Private Equity Investors continue to increase stake in retail assets
India, April 19, 2018: Cushman & Wakefield, leading global real estate consultant’s research findings indicate the continued trend of main streets ruling the retail leasing landscape in top 8 Indian cities. The demand for main streets has heightened in absence of new mall supply in most of these cities coupled with scarcity of available quality space in the existing malls. Largest contributor to main street leasing has been the apparel segment followed by Food & Beverages. Online players have also established considerable offline presence by opening brick & mortar stores on main streets for better visibility as compared to malls.
In first quarter of 2018, of the total leasing transactions recorded in top 8 cities, more than 80% were on main streets vis-à-vis malls. Of the total reported leasing of 1,264,423 square feet (sf) in top 8 cities, main streets accounted for 1,022,345 sf.
While Ahmedabad, Hyderabad and Bengaluru clocked almost 100% of city’s leasing on main streets in Q1 2018, the share was considerably higher in other cities as well.
|
City Name |
Main Street Leasing Share |
|
Ahmedabad |
100% |
|
Bengaluru |
94% |
|
Chennai |
74% |
|
Delhi NCR |
65% |
|
Hyderabad |
100% |
|
31% |
|
|
Mumbai |
28% |
|
Pune |
79% |
|
Source: Cushman & Wakefield |
|
In near future, main streets that promise high visibility and footfalls to retail brands are expected to continue to drive majority transactions with key demand coming from apparel retailers.
Indian mall space retail continues to witness interest from Private Equity players, who are keen to capitalize on the rising middle-class consumption in both tier I and tier II cities. Some of the international PE funds that are looking at getting controlling stakes or complete ownership of retail assets in India include the likes of The Blackstone Group, Canada Pension Plan Investment Board (CPPIB) and the Xander Group.
Although Q1’18 saw only 0.85 msf of new mall supply, around 14.22 msf is currently under construction and 32 new malls are expected to come up by the year 2020. India is a key retail market with a 1.3 billion population, 50% of which is below the age of 25, a growing middle class, high urbanization rate and a fast-growing economy. These features promise a growing retail spend power and hence a shining future for the sector.
“With a strong demographic dividend of young aspiring middle class and favorable government policies allowing 100% FDI in single brand retail, there is high degree of interest from investors & developers to increase their stakes in retail assets in the country. There is a strong pipeline of under construction malls in top 8 cities of India. However, as new quality mall supply is expected to take couple of years to be operational across the country, transactions are likely to increase further on the main streets”.- Anshul Jain, Country Head & Managing Director India, Cushman & Wakefield
For further information, please contact:
Somil Agrawal
Head of Strategic Marketing - India
About Cushman & Wakefield
Cushman & Wakefield is a leading global real estate services firm with 45,000 employees in more than 70 countries helping occupiers and investors optimize the value of their real estate. Cushman & Wakefield is among the largest commercial real estate services firms with revenue of $6 billion across core services of agency leasing, asset services, capital markets, facility services (C&W Services), global occupier services, investment & asset management (DTZ Investors), project & development services, tenant representation, and valuation & advisory. To learn more, visit www.cushmanwakefield.com External Link or follow @ External LinkCushWake External Link on Twitter.
