While the US has witnessed a net closure of nearly 1,200 mall stores since 2020 -- with rising vacancies forcing almost 40 per cent of empty malls to undergo rezoning or repurposing -- India is experiencing a retail resurgence driven by strong consumer demand and growing institutional investor confidence, according to the report by Anarock.
“Latest data shows that in the next three years, Indian malls are set to see over $3.5 billion of capital inflows. Meanwhile, over 88 foreign brands have entered the Indian retail market and are seeking to expand aggressively. Several more global brands are in the pipeline, seeking space in the severely restricted Grade-A assets currently available,” explained Anuj Kejriwal, CEO-Retail Leasing and Industrial and Logistics, Anarock Group.
India has over 600 operational malls, but less than 100 meet the institutional benchmarks that attract global funds – triggering aggressive competition for top-tier assets.
Moreover, India’s per capita retail stock remains one of the lowest in the world - tier 1 cities operate with just 4 to 6 square feet per person, Tier 2 and 3 cities with 2 to 3 sq ft, and Grade A mall space alone sits at barely 0.6 sq. ft. per capita.
In contrast, the US averages close to 23 sq ft, while China exceeds 6 sq ft.
This gap, combined with India’s per-capita income nearly doubling in the last decade, has created a demand–supply mismatch virtually unheard of in global retail, said Kejriwal.
Grade-A malls are running near-full occupancy, reporting 95-100 per cent occupancy with long waitlists for key zones. Rental growth has consistently surpassed pre-pandemic levels, and developers now find leasing cycles outpacing construction cycles -- a rarity anywhere in the world, he noted.
Unlike their Western counterparts, Indian malls are lifestyle destinations anchored in entertainment, dining, and social experiences. Daily footfalls in major malls routinely exceed 20,000 on weekdays and surge beyond 40,000 on weekends.
Food and beverages (F&B) and entertainment now account for 30–35 per cent of footfalls, resulting in a resilient retail mix almost completely immune to the online retail disruptions that are defeating Western malls, the report mentioned.
Among the most attractive dynamics for global investors is that Indian malls have not capitulated to e-commerce -- they are, in fact, benefiting from it.
India’s e-commerce penetration remains around 8 per cent, far below the 20 per cent-plus levels seen in China and the US.
Many leading D2C brands report that offline conversions are 2-3 times higher than online. In India, physical retail has retained its relevance in a digital age, said the report.
“This renders India unique among the world’s leading retail markets,” Kejriwal said.
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